UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-CSR
Certified Shareholder Report of
Registered Management Investment Companies
Investment Company Act File Number: 811-3734
EuroPacific Growth Fund
(Exact Name of Registrant as specified in charter)
333 South Hope Street
Los Angeles, California 90071
(Address of principal executive offices)
Registrant's telephone number, including area code: (213) 486-9200
Date of fiscal year end: March 31
Date of reporting period: September 30, 2005
Vincent P. Corti
Capital Research and Management Company
333 South Hope Street
Los Angeles, California 90071
(name and address of agent for service)
Copies to:
Richard M. Phillips
Kirkpatrick & Lockhart Nicholson Graham LLP
Four Embarcadero Center, 10th Floor
San Francisco, CA 94111
(Counsel for the Registrant)
ITEM 1 - Reports to Stockholders
[logo - American Funds®]
The right choice for the long term®
EuroPacific Growth Fund
[photo of The Campanile and an archway detail from the Piazza San Marco in Venice, Italy]
Semi-annual report for the six months ended September 30, 2005
EuroPacific Growth Fund® seeks long-term capital appreciation by investing primarily in the securities of companies based in Europe and the Pacific Basin. About half of the world’s investment opportunities can be found beyond the borders of our country. As a shareholder in the fund, you have access to what we believe are the best of those opportunities.
This fund is one of the 29 American Funds. The organization ranks among the nation’s three largest mutual fund families. For more than seven decades, Capital Research and Management Company,SM the American Funds adviser, has invested with a long-term focus based on thorough research and attention to risk.
Figures shown are past results for Class A shares and are not predictive of results in future periods. Current and future results may be lower or higher than those shown. Share prices and returns will vary, so investors may lose money. Investing for short periods makes losses more likely. Investments are not FDIC-insured, nor are they deposits of or guaranteed by a bank or any other entity. For the most current information and month-end results, visit americanfunds.com. Fund results shown, unless otherwise indicated, are at net asset value. If a sales charge (maximum 5.75%) had been deducted, the results would have been lower.
Here are the average annual total returns on a $1,000 investment with all distributions reinvested for periods ended September 30, 2005:
Class A shares | 1 year | 5 years | 10 years |
| | | | |
| Reflecting 5.75% maximum sales charge | +21.17% | +3.45% | +9.68% |
The fund’s investment adviser waived 5% of its management fees from September 1, 2004, through March 31, 2005, and increased the waiver to 10% on April 1, 2005. Fund results shown reflect the waiver, without which they would have been lower. Please see the Financial Highlights table on page 22 for details.
Results for other share classes can be found on page 5. Please see page 28 for important information about other share classes.
Investing outside the United States is subject to additional risks, such as currency fluctuations and political instability, which are detailed in the fund’s prospectus.
Fellow shareholders:
[photo of The Campanile and an archway detail from the Piazza San Marco in Venice, Italy]
International markets made good progress in the first half of EuroPacific Growth Fund’s fiscal year, despite the headwind of a dollar that was strong relative to other major currencies. The fund did very well in this environment, appreciating 13.1% in value for the six months ended September 30.
That was ahead of the 11.8% return of its primary benchmark, the unmanaged MSCI All-Country World Index, ex-USA, which measures 48 developed- and developing-country indexes and has no expenses. The fund also outpaced the 10.1% return of the Lipper International Funds Average. By way of comparison, U.S. stocks, as measured by the unmanaged Standard & Poor’s 500 Composite Index, returned 5.0%.
As you can see in the table below, EuroPacific’s record of above-average returns has made a big difference over longer periods: In its 21-1⁄2-year lifetime, the fund has provided a cumulative total return of 1,432.0%, versus an MSCI EAFE® (Europe, Australasia, Far East) Index return of 855.1% and a Lipper International Funds Average return of 846.1%. (The unmanaged EAFE tracks 21 major stock markets outside the United States and has no expenses.)
Non-U.S. stocks charge ahead
International markets overcame a turbulent beginning to the six-month reporting period to finish strong. Stock investors, discouraged by rising U.S. interest rates and disruptions caused by Hurricane Katrina, preferred to look elsewhere, fastening onto signs of improved economic conditions around the globe.
[Begin Sidebar]
Results at a glance (through September 30, 2005, with all distributions reinvested)
| | Totalreturn | Average annual total returns |
| | 1 year | 5 years | 10 years | Lifetime1 |
| | | | | |
| EuroPacific Growth Fund | +28.6% | +4.7% | +10.3% | +13.6% |
| MSCI ACWI (All-Country World) | | | | |
Index ex-USA2,3 | +29.5 | +4.8 | +6.6 | — |
Lipper International Funds Average4 | +25.2 | +2.5 | +6.9 | +11.0 |
MSCI EAFE® (Europe, Australasia, | | | | |
Far East) Index2 | +26.3 | +3.5 | +6.2 | +11.1 |
1 Since April 16, 1984
2 Indexes are unmanaged.
3 The index did not exist prior to 12/31/87.
4 Source: Lipper. Figures do not reflect the effect of sales charges.
[End Sidebar]
Many major markets advanced by double digits, although in many cases currency movements curtailed returns for U.S. investors. After touching bottom in March, the dollar began to gain ground, appreciating roughly 8% against the euro over the six months, 7% against sterling, and 6% against the yen. Even so, returns for dollar-based investors were very good. In Europe, stocks were pushed higher by burgeoning signs of government commitments to restructuring and by a flurry of mergers and acquisitions activity across a number of industries. In dollar terms, Spain (+10.1%), Switzerland (+9.2%), Germany (+8.2%), France (+7.8%) and the United Kingdom (+5.7%) all outpaced U.S. stocks; the Netherlands (+3.6%) and Italy (+2.6%) were slightly weaker.*
*Country returns are based on MSCI indexes and assume reinvestment of gross dividends.
Farther east, Japanese stocks bounced back smartly, increasing 15.0% after a stretch of losses. Investors were heartened by new signs of economic life and an election campaign that hinged on putting Japan back on solid financial footing. South Korean stocks (+22.1%) continued to surge, stimulated in part by active domestic investing into pension plans. Elsewhere in the region, Australia rose a healthy 15.5%, in U.S. dollar terms.
In the Americas, stock markets rewarded U.S. investors not only with absolute price gains but currency appreciation as well. The Canadian dollar gained 4% against its U.S. counterpart, contributing to an overall 21.6% increase in stocks. Higher interest rates in Brazil attracted considerable new foreign investment, increasing the value of the real against the dollar by 20%; despite a series of political scandals, stocks soared an astonishing 47.7% measured in dollars. Currency issues were more muted in Mexico, where stocks nonetheless rose 37.6% for the six months.
A well-positioned portfolio
EuroPacific Growth Fund’s superior returns once again validated our company-by-company approach to building the portfolio. Many of the fund’s largest holdings posted very strong gains. Roche, a Swiss pharmaceutical company and the fund’s largest investment, rose 29.7% in price; the company is a major shareholder in Japan-based Chugai (+24.1%), which likewise benefited. Another drug company, longtime holding AstraZeneca, rose 18.1% in price. Not surprisingly, energy stocks profited from rising fuel costs around the world. Petrobras and Royal Dutch Shell gained 62.0% and 9.5% in price, respectively.
The portfolio’s largest industry concentration continues to be in financial institutions. Stocks of Japanese banks, which we began adding to about a year ago, were particularly strong in recent months, as lending rates in Japan improved. Notable gainers included UFJ Holdings (+54.7%), Mitsui Trust (+39.0%) and Shinhan Financial (+30.1%).
[Begin Sidebar]
Where the fund’s assets are invested (percent invested by country)
EuroPacific invests primarily in the stocks of companies based in Europe and the Pacific Basin.1
| | EuroPacific | EAFE |
| | Growth Fund | Index2 |
| | (9/30/05) | (3/31/05) | (9/30/05) |
Europe | | | |
| | | | |
| United Kingdom | 9.6% | 11.7% | 25.2% |
| Germany | 6.4 | 6.2 | 6.9 |
| France | 6.2 | 6.6 | 9.6 |
| Switzerland | 5.9 | 4.2 | 6.7 |
| Netherlands | 4.3 | 6.2 | 3.2 |
| Spain | 3.2 | 3.5 | 3.9 |
| Norway | 1.4 | 2.3 | .8 |
| Denmark | 1.2 | 1.4 | .8 |
| Italy | 1.1 | 1.3 | 3.8 |
| Hungary | .8 | .7 | — |
| Belgium | .7 | .7 | 1.3 |
| Austria | .6 | .7 | .4 |
| Russia | .6 | — | — |
| Sweden | .5 | .8 | 2.4 |
| Other Europe | .9 | 1.3 | 3.1 |
| | 43.4 | 47.6 | 68.1 |
| | | | |
Pacific Basin | | | |
| | | | |
| Japan | 20.2 | 16.4 | 23.7 |
| South Korea | 6.1 | 5.5 | — |
| Mexico | 3.6 | 2.5 | — |
| Canada | 3.2 | 3.3 | — |
| Taiwan | 3.1 | 3.1 | — |
| Australia | 1.9 | 2.3 | 5.5 |
| Hong Kong | 1.8 | 1.3 | 1.7 |
| China | .7 | .7 | — |
| Indonesia | .6 | — | — |
| Thailand | .5 | — | — |
| Other Pacific Basin | 1.2 | 2.0 | 1.0 |
| | 42.9 | 37.1 | 31.9 |
| | | | |
Other | | | |
| | | | |
| Brazil | 5.1 | 4.4 | — |
| India | 2.6 | 2.0 | — |
| South Africa | .5 | — | — |
| Other countries | .2 | .8 | — |
| | 8.4 | 7.2 | — |
| | | | |
| Cash & equivalents | 5.3% | 8.1% | — |
| | | | |
Total | 100.0% | 100.0% | 100.0% |
1 A country is considered part of the Pacific Basin if any of its borders touches the Pacific Ocean.
2 Weighted by market capitalization.
[End Sidebar]
Not every holding did so well, of course. Among larger positions, technology stocks, such as Taiwan Semiconductor (+3.4%) and Rohm (-10.1%), were lackluster; a number of European telecommunications operators — including France Télécom (-3.9%), Telefónica (-2.0%) and Vodafone (-1.9%) — were also weak. Also in the red were pharmaceutical firms Sanofi-Aventis (-1.9%) and Novo-Nordisk (-11.2%).
Proactive portfolio management
Given the strength in certain areas of the market, we spent the past six months actively refining the portfolio. We added substantially to Roche, América Móvil (+53.0%), Mexico’s primary wireless service provider, Kookmin Bank (+31.7%) of South Korea and Nestle (+7.1%). At the same time we trimmed our exposure to a number of previously sizable positions, among them France Télécom, Telefónica and Cía. Vale do Rio Doce. This last holding gained 42.2% during the period, allowing us to sell into strength.
Investing in companies, not markets
Looking ahead, we continue to see signs of global economic growth, albeit at a slower rate than many had predicted. Recent political changes in Europe and Japan could support an increasingly business-friendly environment. Interest rates outside the United States have remained steady and inflation is still contained, despite rapidly rising energy costs. The latter is certainly a concern, however, particularly in Asia, which is a net importer of fuel. Also of concern is the blistering pace in recent months of a number of stock-market sectors, including energy and many developing markets, which have surged at a rate that cannot be sustained forever.
In the face of these unknowns, we believe, as we always have, that individual stock selection is paramount. Relying on our intensive global research effort, we set our sights on non-U.S. companies most likely to negotiate periods of uncertainty and be industry leaders in the years ahead. More and more of them are succeeding by looking beyond their borders for growth potential. As EuroPacific’s strong record of international investing amply demonstrates, that strategy can be a wise one for investors as well.
Cordially,
/s/ Gina H. Despres
Gina H. Despres
Vice Chairman of the Board
/s/ Mark Denning
Mark Denning
President
November 9, 2005
William I. Miller, an independent Trustee of the fund since 1992, has been elected non-executive chairman of the Board. Gina H. Despres, the previous chairman, has been elected vice chairman. As independent Board chair, Mr. Miller will chair Board meetings, including executive sessions of the independent Trustees, and will be responsible for Board agendas, but will not have other executive or management responsibilities with the fund. He will remain unaffiliated with Capital Research and Management Company, the fund’s investment adviser, and any of its affiliates.
For current information about the fund, visit americanfunds.com.
Other share class results unaudited
Class B, Class C, Class F and Class 529
Figures shown are past results and are not predictive of results in future periods. Current and future results may be lower or higher than those shown. Share prices and returns will vary, so investors may lose money. For the most current information and month-end results, visit americanfunds.com.
Average annual total returns for | | | |
periods ended September 30, 2005: | 1 year | 5 years | Life of class |
| | | | |
Class B shares— first sold 3/15/00 | | | |
| Reflecting applicable contingent deferred | | | |
| sales charge (CDSC), maximum of 5%, | | | |
| payable only if shares are sold within | | | |
| six years of purchase | +22.59% | +3.55% | +0.99% |
| Not reflecting CDSC | +27.59% | +3.90% | +1.15% |
| | | | |
Class C shares — first sold 3/15/01 | | | |
| Reflecting CDSC, maximum of 1%, | | | |
| payable only if shares are sold within | | | |
| one year of purchase | +26.49% | — | +8.00% |
| Not reflecting CDSC | +27.49% | — | +8.00% |
| | | | |
Class F shares1— first sold 3/15/01 | | | |
| Not reflecting annual asset-based fee | | | |
| charged by sponsoring firm | +28.48% | — | +8.86% |
| | | | |
Class 529-A shares2— first sold 2/15/02 | | | |
| Reflecting 5.75% maximum sales charge | +21.08% | — | +12.04% |
| Not reflecting maximum sales charge | +28.44% | — | +13.89% |
| | | | |
Class 529-B shares2— first sold 2/19/02 | | | |
| Reflecting applicable CDSC, maximum | | | |
| of 5%, payable only if shares are sold | | | |
| within six years of purchase | +22.31% | — | +12.91% |
| Not reflecting CDSC | +27.31% | — | +13.51% |
| | | | |
Class 529-C shares2— first sold 2/15/02 | | | |
| Reflecting CDSC, maximum of 1%, payable | | | |
| only if shares are sold within one year of | | | |
| purchase | +26.36% | — | +12.91% |
| Not reflecting CDSC | +27.36% | — | +12.91% |
| | | | |
Class 529-E shares1,2 — first sold 3/7/02 | +28.03% | — | +12.11% |
| | | | |
Class 529-F shares1,2— first sold 9/16/02 | | | |
| Not reflecting annual asset-based fee | | | |
| charged by sponsoring firm | +28.48% | — | +22.12% |
The fund’s investment adviser waived 5% of its management fees from September 1, 2004, through March 31, 2005, and increased the waiver to 10% on April 1, 2005. Fund results shown reflect the waiver, without which they would have been lower. Please see the Financial Highlights table on page 22 for details.
1 These shares are sold without any initial or contingent deferred sales charge.
2 Results shown do not reflect the $10 initial account setup fee and an annual $10 account maintenance fee.
| | | | unaudited |
Summary investment portfolio, September 30, 2005 | | | |
The following summary investment portfolio is designed to streamline the report and help investors better focus on a fund’s principal holdings. For details on how to obtain a complete schedule of portfolio holdings, please see the inside back cover.
[begin pie chart]
| Industry sector diversification | | |
| Financials | 23.34% | |
| Consumer discretionary | 11.89 | |
| Telecommunication services | 11.14 | |
| Information technology | 9.67 | |
| Health care | 9.08 | |
| Other industries | 29.39 | |
| Bonds & notes | 0.17 | |
| Convertible securities & warrants | 0.05 | |
| Cash & Equivalents | 5.27 | |
[end pie chart]
| | | | Shares | | | Market | | | Percent | |
| | | | | | | value | | | of net | |
| Common stocks - 94.51% | | | | | | (000 | ) | | assets | |
| | | | | | | | | | | |
| Financials - 23.34% | | | | | | | | | | |
| UFJ Holdings, Inc. (1) (2) | | | 118,513 | | $ | 964,962 | | | 1.51 | % |
| Kookmin Bank (2) | | | 15,593,040 | | | 917,718 | | | 1.44 | |
| Allianz AG (2) | | | 4,311,335 | | | 584,107 | | | .92 | |
| Mitsui Trust Holdings, Inc. (2) | | | 39,187,000 | | | 541,571 | | | .85 | |
| ABN AMRO Holding NV (2) | | | 22,564,802 | | | 540,559 | | | .85 | |
| ING Groep NV (2) | | | 17,377,817 | | | 518,202 | | | .81 | |
| Banco Bradesco SA, preferred nominative | | | 9,660,600 | | | 473,030 | | | .74 | |
| Banco Santander Central Hispano, SA (2) | | | 32,275,106 | | | 424,917 | | | .66 | |
| Shinhan Financial Group Co., Ltd. (2) | | | 11,949,400 | | | 416,605 | | | .65 | |
| UBS AG (2) | | | 4,868,398 | | | 413,487 | | | .65 | |
| Banco Itaú Holding Financeira SA, preferred nominative | | | 1,580,600 | | | 378,789 | | | .59 | |
| Other securities | | | | | | 8,720,402 | | | 13.67 | |
| | | | | | | 14,894,349 | | | 23.34 | |
| | | | | | | | | | | |
| Consumer discretionary - 11.89% | | | | | | | | | | |
| Toyota Motor Corp. (2) | | | 11,122,600 | | | 509,713 | | | .80 | |
| Honda Motor Co., Ltd. (2) | | | 8,335,100 | | | 471,625 | | | .74 | |
| Hyundai Motor Co. (2) | | | 5,861,120 | | | 460,852 | | | .72 | |
| Industria de Diseno Textil, SA (2) | | | 14,300,468 | | | 420,172 | | | .66 | |
| Continental AG (2) | | | 4,977,500 | | | 409,723 | | | .64 | |
| Bridgestone Corp. (2) | | | 16,316,000 | | | 349,901 | | | .55 | |
| Other securities | | | | | | 4,965,607 | | | 7.78 | |
| | | | | | | 7,587,593 | | | 11.89 | |
| | | | | | | | | | | |
| Telecommunication services - 11.14% | | | | | | | | | | |
| Vodafone Group PLC (2) | | | 436,435,890 | | | 1,136,022 | | | 1.78 | |
| América Móvil SA de CV, Series L (ADR) | | | 33,648,000 | | | 885,615 | | | | |
| América Móvil SA de CV, Series L | | | 21,540,000 | | | 28,387 | | | 1.43 | |
| Telefónica, SA (2) | | | 38,798,154 | | | 636,759 | | | 1.00 | |
| France Télécom, SA (2) | | | 16,793,000 | | | 483,453 | | | .76 | |
| Koninklijke KPN NV (2) | | | 50,755,000 | | | 455,883 | | | .72 | |
| Telekom Austria AG (2) | | | 19,684,056 | | | 391,588 | | | .61 | |
| Other securities | | | | | | 3,090,256 | | | 4.84 | |
| | | | | | | 7,107,963 | | | 11.14 | |
| | | | | | | | | | | |
| Information technology - 9.67% | | | | | | | | | | |
| SOFTBANK CORP. (2) | | | 17,154,900 | | | 952,850 | | | 1.49 | |
| Taiwan Semiconductor Manufacturing Co. Ltd. (2) | | | 433,157,406 | | | 698,330 | | | | |
| Taiwan Semiconductor Manufacturing Co. Ltd. (ADR) | | | 9,556,400 | | | 78,554 | | | 1.22 | |
| Samsung Electronics Co., Ltd. (2) | | | 1,076,775 | | | 608,104 | | | .95 | |
| Hon Hai Precision Industry Co., Ltd. (2) | | | 130,046,846 | | | 607,756 | | | .95 | |
| Rohm Co., Ltd. (2) | | | 4,272,100 | | | 370,910 | | | .58 | |
| Murata Manufacturing Co., Ltd. (2) | | | 6,377,500 | | | 355,959 | | | .56 | |
| Other securities | | | | | | 2,502,730 | | | 3.92 | |
| | | | | | | 6,175,193 | | | 9.67 | |
| | | | | | | | | | | |
| Health care - 9.08% | | | | | | | | | | |
| Roche Holding AG (2) | | | 12,019,200 | | | 1,671,026 | | | 2.62 | |
| Sanofi-Aventis (2) | | | 16,344,087 | | | 1,352,041 | | | 2.12 | |
| AstraZeneca PLC (Sweden) (2) | | | 8,756,617 | | | 408,279 | | | | |
| AstraZeneca PLC (United Kingdom) (2) | | | 4,505,000 | | | 210,154 | | | .97 | |
| Novo Nordisk A/S, Class B (2) | | | 12,425,650 | | | 614,758 | | | .96 | |
| Chugai Pharmaceutical Co., Ltd. (2) | | | 19,547,200 | | | 372,872 | | | .58 | |
| UCB NV (2) | | | 6,796,059 | | | 359,358 | | | .56 | |
| Other securities | | | | | | 810,453 | | | 1.27 | |
| | | | | | | 5,798,941 | | | 9.08 | |
| | | | | | | | | | | |
| Energy - 7.68% | | | | | | | | | | |
| Petróleo Brasileiro SA - Petrobras, ordinary nominative (ADR) | | | 10,301,150 | | | 736,429 | | | | |
| Petróleo Brasileiro SA - Petrobras, preferred nominative (ADR) | | | 798,850 | | | 50,927 | | | 1.23 | |
| Royal Dutch Shell PLC, Class B (2) | | | 9,583,091 | | | 330,315 | | | | |
| Royal Dutch Shell PLC, Class A (2) | | | 6,600,000 | | | 217,600 | | | | |
| Royal Dutch Shell PLC, Class B (ADR) | | | 1,874,848 | | | 129,121 | | | | |
| Royal Dutch Shell PLC, Class A (ADR) | | | 1,000,000 | | | 65,640 | | | 1.16 | |
| MOL Magyar Olaj- és Gázipari Rt., Class A (2) | | | 4,500,500 | | | 498,843 | | | .78 | |
| Canadian Natural Resources, Ltd. | | | 8,580,000 | | | 387,984 | | | .61 | |
| Norsk Hydro ASA (2) | | | 3,175,000 | | | 353,917 | | | | |
| Norsk Hydro ASA (ADR) | | | 250,000 | | | 27,812 | | | .60 | |
| Reliance Industries Ltd. (2) | | | 20,260,718 | | | 366,325 | | | .57 | |
| Petro-Canada | | | 8,600,000 | | | 360,444 | | | .57 | |
| Other securities | | | | | | 1,378,700 | | | 2.16 | |
| | | | | | | 4,904,057 | | | 7.68 | |
| | | | | | | | | | | |
| Consumer staples - 6.68% | | | | | | | | | | |
| Nestlé SA (2) | | | 2,332,500 | | | 683,596 | | | 1.07 | |
| Koninklijke Ahold NV (1) (2) | | | 77,643,332 | | | 587,610 | | | .92 | |
| Other securities | | | | | | 2,992,417 | | | 4.69 | |
| | | | | | | 4,263,623 | | | 6.68 | |
| | | | | | | | | | | |
| Materials - 5.62% | | | | | | | | | | |
| Bayer AG (2) | | | 12,510,000 | | | 458,461 | | | .72 | |
| Cemex, SA de CV, ordinary participation certificates, units (ADR) | | | 8,504,791 | | | 444,801 | | | .70 | |
| Other securities | | | | | | 2,683,351 | | | 4.20 | |
| | | | | | | 3,586,613 | | | 5.62 | |
| | | | | | | | | | | |
| Industrials - 4.23% | | | | | | | | | | |
| Siemens AG (2) | | | 6,604,000 | | | 509,679 | | | .80 | |
| Asahi Glass Co., Ltd. (2) | | | 38,439,000 | | | 403,828 | | | .63 | |
| Mitsubishi Corp. (2) | | | 17,700,000 | | | 349,419 | | | .55 | |
| Other securities | | | | | | 1,435,771 | | | 2.25 | |
| | | | | | | 2,698,697 | | | 4.23 | |
| | | | | | | | | | | |
| Utilities - 2.77% | | | | | | | | | | |
| E.ON AG (2) | | | 3,948,000 | | | 362,825 | | | .57 | |
| Other securities | | | | | | 1,403,224 | | | 2.20 | |
| | | | | | | 1,766,049 | | | 2.77 | |
| | | | | | | | | | | |
| Miscellaneous - 2.41% | | | | | | | | | | |
| Other common stocks in initial period of acquisition | | | | | | 1,538,609 | | | 2.41 | |
| | | | | | | | | | | |
| | | | | | | | | | | |
| Total common stocks (cost: $43,693,450,000) | | | | | | 60,321,687 | | | 94.51 | |
| | | | | | | | | | | |
| | | | | | | | | | | |
| Warrants - 0.02% | | | | | | | | | | |
| | | | | | | | | | | |
| Financials - 0.02% | | | | | | | | | | |
| | | | | | | | | | | |
| Other securities | | | | | | 9,462 | | | .02 | |
| | | | | | | | | | | |
| | | | | | | | | | | |
| Total warrants (cost: $46,430,000) | | | | | | 9,462 | | | .02 | |
| | | | | | | | | | | |
| | | | | | | | | | | |
| Convertible securities - 0.03% | | | | | | | | | | |
| | | | | | | | | | | |
| Financials - 0.03% | | | | | | | | | | |
| | | | | | | | | | | |
| Other securities | | | | | | 19,975 | | | .03 | |
| | | | | | | | | | | |
| | | | | | | | | | | |
| Total convertible securities (cost: $20,372,000) | | | | | | 19,975 | | | .03 | |
| | | | | | | | | | | |
| | | | | | | | | | | |
| Bonds & notes - 0.17% | | | | | | | | | | |
| | | | | | | | | | | |
| Non-U.S. government bonds & notes - 0.17% | | | | | | | | | | |
| | | | | | | | | | | |
| Other securities | | | | | | 110,439 | | | .17 | |
| | | | | | | | | | | |
| | | | | | | | | | | |
| Total bonds & notes (cost: $99,972,000) | | | | | | 110,439 | | | .17 | |
| | | | | | | | | | | |
| | | | | | | | | | | |
| | | | | | | | | | | |
| Short-term securities - 5.19% | | | Principal amount (000) | | | | | | | |
| | | | | | | | | | | |
| | | | | | | | | | | |
| Amsterdam Funding Corp. 3.59%-3.77% due 10/19-11/10/2005 (3) | | $ | 73,200 | | | 72,939 | | | | |
| ABN-AMRO North America Finance Inc. 3.45% due 10/11/2005 | | | 26,800 | | | 26,771 | | | .15 | |
| Other securities | | | | | | 3,215,573 | | | 5.04 | |
| | | | | | | | | | | |
| | | | | | | | | | | |
| Total short-term securities (cost: $3,315,085,000) | | | | | | 3,315,283 | | | 5.19 | |
| | | | | | | | | | | |
| | | | | | | | | | | |
| Total investment securities (cost: $47,175,309,000) | | | | | | 63,776,846 | | | 99.92 | |
| Other assets less liabilities | | | | | | 51,615 | | | .08 | |
| | | | | | | | | | | |
| Net assets | | | | | $ | 63,828,461 | | | 100.00 | % |
| "Miscellaneous" securities include holdings in their initial period of acquisition that have not previously been publicly disclosed. |
| "Other securities" includes all issues that are not disclosed separately in the summary investment portfolio. |
| |
| |
| (1) Security did not produce income during the last 12 months. |
| (2) Valued under fair value procedures adopted by authority of the Board of Trustees. At September 30, 2005, 265 of the fund's securities, |
| including those in "Other securities" and "Miscellaneous" in the summary investment portfolio (with aggregate value |
| of $51,045,486,000), were fair valued under procedures that took into account significant price changes that occurred between the close |
of trading in those securities and the close of regular trading on the New York Stock Exchange. |
(3) Purchased in a private placement transaction; resale may be limited to qualified institutional buyers; resale to the public may require |
registration. The total value of all such restricted securities, including those in "Other securities" in the summary investment portfolio, |
| was $1,400,193,000 which represented 2.19% of the net assets of the fund. |
| |
| ADR = American Depositary Receipts |
| GDR = Global Depositary Receipts |
See Notes to Financial Statements
| Financial statements | | | | | | | | | |
| | | | | | | | | | | | | |
| Statement of assets and liabilities | | | | | | | | | unaudited | | | |
| at September 30, 2005 | | | (dollars and shares in thousands, except per-share amounts) | |
| | | | | | | | | | | | | |
| Assets: | | | | | | | | | | | | |
| Investment securities at market (cost: $47,175,309) | | | | | | | | $ | 63,776,846 | | | |
| Cash denominated in non-U.S. currencies | | | | | | | | | | | | |
| (cost: $12,485) | | | | | | | | | 12,117 | | | |
| Cash | | | | | | | | | 32,156 | | | |
| Receivables for: | | | | | | | | | | | | |
| Sales of investments | | | | | $ | 220,856 | | | | | | |
| Sales of fund's shares | | | | | | 142,746 | | | | | | |
| Dividends and interest | | | | | | 115,383 | | | 478,985 | | | |
| | | | | | | | | | 64,300,104 | | | |
| Liabilities: | | | | | | | | | | | | |
| Payables for: | | | | | | | | | | | | |
| Purchases of investments | | | | | | 300,557 | | | | | | |
| Repurchases of fund's shares | | | | | | 95,255 | | | | | | |
| Open forward currency contracts | | | | | | 2,194 | | | | | | |
| Investment advisory services | | | | | | 20,180 | | | | | | |
| Services provided by affiliates | | | | | | 18,813 | | | | | | |
| Deferred Trustees' compensation | | | | | | 2,353 | | | | | | |
| Other fees and expenses | | | | | | 32,291 | | | 471,643 | | | |
| Net assets at September 30, 2005 | | | | | | | | $ | 63,828,461 | | | |
| | | | | | | | | | | | | |
| Net assets consist of: | | | | | | | | | | | | |
| Capital paid in on shares of beneficial interest | | | | | | | | $ | 44,789,316 | | | |
| Undistributed net investment income | | | | | | | | | 603,288 | | | |
| Undistributed net realized gain | | | | | | | | | 1,866,441 | | | |
| Net unrealized appreciation | | | | | | | | | 16,569,416 | | | |
| Net assets at September 30, 2005 | | | | | | | | $ | 63,828,461 | | | |
| | | | | | | | | | | | | |
| Shares of beneficial interest issued and outstanding - unlimited shares authorized (1,587,582 total shares outstanding) | | | | | | | | | | | | |
| | | | Net assets | | | Shares outstanding | | | Net asset value per share(1) | | | |
| | | | | | | | | | | | | |
| Class A | | $ | 41,920,667 | | | 1,040,099 | | $ | 40.30 | | | |
| Class B | | | 1,107,843 | | | 27,850 | | | 39.78 | | | |
| Class C | | | 1,934,212 | | | 48,997 | | | 39.48 | | | |
| Class F | | | 4,958,352 | | | 123,423 | | | 40.17 | | | |
| Class 529-A | | | 266,747 | | | 6,647 | | | 40.13 | | | |
| Class 529-B | | | 48,556 | | | 1,229 | | | 39.51 | | | |
| Class 529-C | | | 116,643 | | | 2,953 | | | 39.51 | | | |
| Class 529-E | | | 16,059 | | | 403 | | | 39.88 | | | |
| Class 529-F | | | 15,611 | | | 389 | | | 40.12 | | | |
| Class R-1 | | | 37,348 | | | 946 | | | 39.48 | | | |
| Class R-2 | | | 506,006 | | | 12,807 | | | 39.51 | | | |
| Class R-3 | | | 3,150,115 | | | 79,174 | | | 39.79 | | | |
| Class R-4 | | | 3,564,138 | | | 89,396 | | | 39.87 | | | |
| Class R-5 | | | 6,186,164 | | | 153,269 | | | 40.36 | | | |
| (1) Maximum offering price and redemption price per share were equal to the net asset value per share for all share classes, except for classes A and 529-A, for which the maximum offering prices per share were $42.77 and $42.58, respectively. | | | |
| | | | | | | | | | | | | |
| | | | | | | | | | | | | |
| See Notes to Financial Statements | | | | | | | | | | | | |
| | | | | | | | | | | | | |
| Statement of operations | | | | | | | | | unaudited | | | |
| for the six months ended September 30, 2005 | | | | | | (dollars in thousands) | | | |
| | | | | | | | | | | | | |
| Investment income: | | | | | | | | | | | | |
| Income: | | | | | | | | | | | | |
Dividends (net of non-U.S. withholding tax of $97,606) | | | | | | | | | | | | |
| | | | | | $ | 817,874 | | | | | | |
Interest (net of non-U.S. withholding tax of $2) | | | | | | | | | | | | |
| | | | | | | 67,358 | | $ | 885,232 | | | |
| Fees and expenses:(1) | | | | | | | | | | | | |
| Investment advisory services | | | | | | 125,820 | | | | | | |
| Distribution services | | | | | | 80,151 | | | | | | |
| Transfer agent services | | | | | | 15,744 | | | | | | |
| Administrative services | | | | | | 13,245 | | | | | | |
| Reports to shareholders | | | | | | 927 | | | | | | |
| Registration statement and prospectus | | | | | | 2,370 | | | | | | |
| Postage, stationery and supplies | | | | | | 1,902 | | | | | | |
| Trustees' compensation | | | | | | 308 | | | | | | |
| Auditing and legal | | | | | | 55 | | | | | | |
| Custodian | | | | | | 8,734 | | | | | | |
| Other | | | | | | 164 | | | | | | |
| Total fees and expenses before reimbursements/waivers | | | | | | 249,420 | | | | | | |
| Less reimbursement/waiver of fees and expenses: | | | | | | | | | | | | |
| Investment advisory services | | | | | | 12,582 | | | | | | |
| Administrative services | | | | | | 363 | | | | | | |
| Total fees and expenses after reimbursements/waivers | | | | | | | | | 236,475 | | | |
| Net investment income | | | | | | | | | 648,757 | | | |
| | | | | | | | | | | | | |
Net realized gain and unrealized appreciation on investments | | | | | | | | | | | | |
| and non-U.S. currency: | | | | | | | | | | | | |
| Net realized gain (loss) on: | | | | | | | | | | | | |
| Investments | | | | | | 1,219,741 | | | | | | |
| Non-U.S. currency transactions | | | | | | (17,255 | ) | | 1,202,486 | | | |
| Net unrealized appreciation (depreciation) on: | | | | | | | | | | | | |
| Investments | | | | | | 5,458,082 | | | | | | |
| Non-U.S. currency translations | | | | | | (4,940 | ) | | 5,453,142 | | | |
Net realized gain and unrealized appreciation | | | | | | | | | | | | |
| on investments and non-U.S. currency | | | | | | | | | 6,655,628 | | | |
Net increase in net assets resulting from operations | | | | | | | | $ | 7,304,385 | | | |
| | | | | | | | | | | | | |
| (1) Additional information related to class-specific fees and expenses is included in the Notes to Financial Statements. | | | |
| | | | | | | | | | | | | |
| See Notes to Financial Statements | | | | | | | | | | | | |
| | | | | | | | | | | | | |
| | | | | | | | | | | | | |
| Statements of changes in net assets | | | | | | (dollars in thousands) | | | |
| | | | | | | | | | |
| | | | | | | Six months ended September 30, | | | Year Ended March 31, | | | |
| | | | | | | 2005* | | | 2005 | | | |
| Operations: | | | | | | | | | | | | |
| Net investment income | | | | | $ | 648,757 | | $ | 578,352 | | | |
Net realized gain on investments and non-U.S. currency transactions | | | | | | 1,202,486 | | | 2,670,830 | | | |
| | | | | | | | | | | | | |
Net unrealized appreciation on investments and non-U.S. currency translations | | | | | | 5,453,142 | | | 2,265,511 | | | |
Net increase in net assets resulting from operations | | | | | | 7,304,385 | | | 5,514,693 | | | |
| | | | | | | | | | | | | |
| Dividends paid to shareholders from net investment income | | | | | | - | | | (716,189 | ) | | |
| | | | | | | | | | | | | |
| Capital share transactions | | | | | | 2,359,583 | | | 7,477,962 | | | |
| | | | | | | | | | | | | |
| Total increase in net assets | | | | | | 9,663,968 | | | 12,276,466 | | | |
| | | | | | | | | | | | | |
| Net assets: | | | | | | | | | | | | |
| Beginning of period | | | | | | 54,164,493 | | | 41,888,027 | | | |
| End of period (including undistributed net investment income and distributions in excess of net investment income: | | | | | | | | | | | | |
| $603,288 and $(45,469), respectively) | | | | | $ | 63,828,461 | | $ | 54,164,493 | | | |
| | | | | | | | | | | | | |
| *Unaudited | | | | | | | | | | | | |
| | | | | | | | | | | | | |
| See Notes to Financial Statements | | | | | | | | | | | | |
Notes to financial statements unaudited
| 1. | Organization and significant accounting policies |
Organization - EuroPacific Growth Fund (the "fund") is registered under the Investment Company Act of 1940 as an open-end, diversified management investment company. The fund seeks long-term capital appreciation by investing primarily in the securities of companies based in Europe and the Pacific Basin.
The fund offers 14 share classes consisting of four retail share classes, five CollegeAmericaÒ savings plan share classes and five retirement plan share classes. The CollegeAmerica savings plan share classes (529-A, 529-B, 529-C, 529-E and 529-F) can be utilized to save for college education. The five retirement plan share classes (R-1, R-2, R-3, R-4 and R-5) are sold without any sales charges and do not carry any conversion rights. The fund’s share classes are described below:
Share class | Initial sales charge | Contingent deferred sales charge upon redemption | Conversion feature |
| | | | |
| Classes A and 529-A | Up to 5.75% | None (except 1% for certain redemptions within one year of purchase without an initial sales charge) | None |
| | | | |
| Classes B and 529-B | None | Declines from 5% to 0% for redemptions within six years of purchase | Classes B and 529-B convert to classes A and 529-A, respectively, after eight years |
| | | | |
| Class C | None | 1% for redemptions within one year of purchase | Class C converts to Class F after 10 years |
| | | | |
| Class 529-C | None | 1% for redemptions within one year of purchase | None |
| | | | |
| Class 529-E | None | None | None |
| | | | |
| Classes F and 529-F | None | None | None |
| | | | |
| Classes R-1, R-2, R-3, R-4 and R-5 | None | None | None |
| | | | |
Holders of all share classes have equal pro rata rights to assets, dividends and liquidation proceeds. Each share class has identical voting rights, except for the exclusive right to vote on matters affecting only its class. Share classes have different fees and expenses ("class-specific fees and expenses"), primarily due to different arrangements for distribution, administrative and shareholder services. Differences in class-specific fees and expenses will result in differences in net investment income and, therefore, the payment of different per-share dividends by each class.
Significant accounting policies - The financial statements have been prepared to comply with accounting principles generally accepted in the United States of America. These principles require management to make estimates and assumptions that affect reported amounts and disclosures. Actual results could differ from those estimates. The following is a summary of the significant accounting policies followed by the fund:
Security valuation - Equity securities are valued at the official closing price of, or the last reported sale price on, the exchange or market on which such securities are traded, as of the close of business on the day the securities are being valued or, lacking any sales, at the last available bid price. Prices for each security are taken from the principal exchange or market in which the security trades. Fixed-income securities, including short-term securities purchased with more than 60 days left to maturity, are valued at prices obtained from an independent pricing service when such prices are available. However, where the investment adviser deems it appropriate, such securities will be valued at the mean quoted bid and asked prices (or bid prices, if asked prices are not available) or at prices for securities of comparable maturity, quality and type. Securities with both fixed-income and equity characteristics, or equity securities traded principally among fixed-income dealers, are valued in the manner described above for either equity or fixed-income securities, depending on which method is deemed most appropriate by the investment adviser. Short-term securities purchased within 60 days to maturity are valued at amortized cost, which approximates market value. The value of short-term securities originally purchased with maturities greater than 60 days is determined based on an amortized value to par when they reach 60 days or less remaining to maturity. The ability of the issuers of the debt securities held by the fund to meet their obligations may be affected by economic developments in a specific industry, state or region. Forward currency contracts are valued at the mean of representative quoted bid and asked prices. Securities and other assets for which representative market quotations are not readily available are fair valued as determined in good faith under procedures adopted by authority of the fund's Board of Trustees. Various factors may be reviewed in order to make a good faith determination of a security’s fair value. These factors include, but are not limited to, the type and cost of the security; contractual or legal restrictions on resale of the security; relevant financial or business developments of the issuer; actively traded similar or related securities; conversion or exchange rights on the security; related corporate actions; and changes in overall market conditions. If events occur that materially affect the value of securities (particularly non-U.S. securities) between the close of trading in those securities and the close of regular trading on the New York Stock Exchange, the securities are fair valued.
Security transactions and related investment income - Security transactions are recorded by the fund as of the date the trades are executed with brokers. Realized gains and losses from security transactions are determined based on the specific identified cost of the securities. In the event a security is purchased with a delayed payment date, the fund will segregate liquid assets sufficient to meet its payment obligations. Dividend income is recognized on the ex-dividend date and interest income is recognized on an accrual basis. Market discounts, premiums and original issue discounts on fixed-income securities are amortized daily over the expected life of the security.
Class allocations - Income, fees and expenses (other than class-specific fees and expenses) and realized and unrealized gains and losses are allocated daily among the various share classes based on their relative net assets. Class-specific fees and expenses, such as distribution, administrative and shareholder services, are charged directly to the respective share class.
Dividends and distributions to shareholders - Dividends and distributions paid to shareholders are recorded on the ex-dividend date.
Non-U.S. currency translation - Assets and liabilities, including investment securities, denominated in non-U.S. currencies are translated into U.S. dollars at the exchange rates in effect at the end of the reporting period. Purchases and sales of investment securities and income and expenses are translated into U.S. dollars at the exchange rates on the dates of such transactions. In the accompanying financial statements, the effects of changes in non-U.S. exchange rates on investment securities are included with the net realized gain or loss and net unrealized appreciation or depreciation on investments. The realized gain or loss and unrealized appreciation or depreciation resulting from all other transactions denominated in non-U.S. currencies are disclosed separately.
Forward currency contracts - The fund may enter into forward currency contracts, which represent agreements to exchange non-U.S. currencies on specific future dates at predetermined rates. The fund enters into these contracts to manage its exposure to changes in non-U.S. exchange rates arising from investments denominated in non-U.S. currencies. Upon entering into these contracts, risks may arise from the potential inability of counterparties to meet the terms of their contracts and from possible movements in non-U.S. exchange rates. Due to these risks, the fund could incur losses up to the entire contract amount, which may exceed the net unrealized value shown on the accompanying financial statements. On a daily basis, the fund values forward currency contracts based on the applicable exchange rates and records unrealized gains or losses. The fund records realized gains or losses at the time the forward contract is closed or offset by another contract with the same broker for the same settlement date and currency.
2. Non-U.S. investments
Investment risk - The risks of investing in securities of non-U.S. issuers may include, but are not limited to, investment and repatriation restrictions; revaluation of currencies; adverse political, social and economic developments; government involvement in the private sector; limited and less reliable investor information; lack of liquidity; certain local tax law considerations; and limited regulation of the securities markets.
Taxation - Dividend and interest income is recorded net of non-U.S. withholding taxes paid. Gains realized by the fund on the sale of securities in certain countries are subject to non-U.S. taxes. The fund records a liability based on unrealized gains to provide for potential non-U.S. taxes payable upon the sale of these securities. For the six months ended September 30, 2005, non-U.S. withholding taxes paid on realized gains were $12,190,000. As of September 30, 2005, non-U.S. taxes provided on unrealized gains were $28,093,000.
3. Federal income taxation and distributions
The fund complies with the requirements under Subchapter M of the Internal Revenue Code applicable to mutual funds and intends to distribute substantially all of its net taxable income and net capital gains each year. The fund is not subject to income taxes to the extent such distributions are made.
Distributions - Distributions paid to shareholders are based on net investment income and net realized gains determined on a tax basis, which may differ from net investment income and net realized gains for financial reporting purposes. These differences are due primarily to differing treatment for items such as non-U.S. currency gains and losses; short-term capital gains and losses; capital losses related to sales of certain securities within 30 days of purchase; unrealized appreciation of certain investments in non-U.S. securities; and deferred expenses. The fiscal year in which amounts are distributed may differ from the year in which the net investment income and net realized gains are recorded by the fund for financial reporting purposes. As of September 30, 2005, the cost of investment securities, excluding forward currency contracts, for federal income tax purposes was $47,493,372,000.
As of September 30, 2005, the components of distributable earnings on a tax basis were as follows (dollars in thousands):
| Undistributed net investment income and non-U.S. currency gains | $890,064 |
| Undistributed short-term capital gains | 41,536 |
Undistributed long-term capital gains | 1,858,501 |
| Gross unrealized appreciation on investment securities | 17,202,545 |
| Gross unrealized depreciation on investment securities | (919,071) |
| Net unrealized appreciation on investment securities | 16,283,474 |
Undistributed net investment income and non-U.S. currency gains above include non-U.S. currency losses of $3,693,000 that were realized during the period November 1, 2004, through March 31, 2005. During the six months ended September 30, 2005, the fund realized, on a tax basis, a net capital gain of $1,232,104,000.
No distributions were paid to shareholders during the six months ended September 30, 2005. For the year ended March 31, 2005, ordinary income distributions paid to shareholders from net investment income were as follows (dollars in thousands):
Share class | | Year ended March 31, 2005 | |
| Class A | | $522,903 | |
| Class B | | 7,662 | |
| Class C | | 12,061 | |
| Class F | | 49,621 | |
| Class 529-A | | | 2,348 | |
| Class 529-B | | | 270 | |
| Class 529-C | | | 603 | |
| Class 529-E | | | 119 | |
| Class 529-F | | | 132 | |
| Class R-1 | | | 240 | |
| Class R-2 | | | 2,902 | |
| Class R-3 | | | 23,867 | |
| Class R-4 | | | 31,595 | |
| Class R-5 | | | 61,866 | |
| Total | | | $716,189 | |
4. Fees and transactions with related parties
Capital Research and Management Company ("CRMC"), the fund’s investment adviser, is the parent company of American Funds Service Company ("AFS"), the fund’s transfer agent, and American Funds Distributors, Inc. ("AFD"), the principal underwriter of the fund’s shares.
Investment advisory services - The Investment Advisory and Service Agreement with CRMC provided for monthly fees accrued daily. These fees are based on a declining series of annual rates beginning with 0.690% on the first $500 million of daily net assets and decreasing to 0.405% on such assets in excess of $71 billion. CRMC is currently waiving 10% of investment advisory services fees. During the six months ended September 30, 2005, total investment advisory services fees waived by CRMC were $12,582,000. As a result, the fee shown on the accompanying financial statements of $125,820,000, which was equivalent to an annualized rate of 0.438%, was reduced to $113,238,000, or 0.394% of average daily net assets.
Class-specific fees and expenses - Expenses that are specific to individual share classes are accrued directly to the respective share class. The principal class-specific fees and expenses are described below:
Distribution services - The fund has adopted plans of distribution for all share classes, except Class R-5. Under the plans, the Board of Trustees approves certain categories of expenses that are used to finance activities primarily intended to sell fund shares and service existing accounts. The plans provide for payments, based on an annualized percentage of average daily net assets, ranging from 0.25% to 1.00% as noted below. In some cases, the Board of Trustees has limited the amounts that may be paid to less than the maximum allowed by the plans. All share classes may use up to 0.25% of average daily net assets to pay service fees, or to compensate AFD for paying service fees, to firms that have entered into agreements with AFD for providing certain shareholder services. The remaining amounts available to be paid under each plan are paid to selling dealers to compensate them for their selling activities.
For classes A and 529-A, the Board of Trustees has also approved the reimbursement of dealer and wholesaler commissions paid by AFD for certain shares sold without a sales charge. These classes reimburse AFD for amounts billed within the prior 15 months but only to the extent that the overall annual expense limit of 0.25% is not exceeded. As of September 30, 2005, unreimbursed expenses subject to reimbursement totaled $13,829,000 for Class A. There were no unreimbursed expenses subject to reimbursement for Class 529-A.
Share class | Currently approved limits | Plan limits |
| | | |
| Class A | 0.25% | 0.25% |
| Class 529-A | 0.25 | 0.50 |
| Classes B and 529-B | 1.00 | 1.00 |
| Classes C, 529-C and R-1 | 1.00 | 1.00 |
| Class R-2 | 0.75 | 1.00 |
| Classes 529-E and R-3 | 0.50 | 0.75 |
| Classes F, 529-F and R-4 | 0.25 | 0.50 |
Transfer agent services - The fund has a transfer agent agreement with AFS for classes A and B. Under this agreement, these share classes compensate AFS for transfer agent services including shareholder recordkeeping, communications and transaction processing. AFS is also compensated for certain transfer agent services provided to all other share classes from the administrative services fees paid to CRMC described below.
Administrative services - The fund has an administrative services agreement with CRMC to provide transfer agent and other related shareholder services for all share classes other than classes A and B. Each relevant share class pays CRMC annual fees up to 0.15% (0.10% for Class R-5) based on its respective average daily net assets. Each relevant share class also pays AFS additional amounts for certain transfer agent services. CRMC and AFS may use these fees to compensate third parties for performing these services. CRMC has agreed to pay AFS on the fund’s behalf for a portion of the transfer agent services fees for some of the retirement plan share classes. For the six months ended September 30, 2005, the total administrative services fees paid by CRMC were $1,000 and $362,000 for classes R-1 and R-2 respectively. Administrative services fees are presented gross of any payments made by CRMC. Each 529 share class is subject to an additional annual administrative services fee of 0.10% of its respective average daily net assets; this fee is payable to the Commonwealth of Virginia for the maintenance of the CollegeAmerica plan. Although these amounts are included with administrative services fees on the accompanying financial statements, the Commonwealth of Virginia is not considered a related party.
Expenses under the agreements described above for the six months ended September 30, 2005, were as follows (dollars in thousands):
Share class | Distribution services | Transfer agent services | Administrative services |
CRMC administrative services | Transfer agent services | Commonwealth of Virginia administrative services |
| Class A | $48,298 | $15,357 | Not applicable | Not applicable | Not applicable |
| Class B | 5,023 | 387 | Not applicable | Not applicable | Not applicable |
| Class C | 8,418 | Included in administrative services | $1,258 | $159 | Not applicable |
| Class F | 5,386 | 2,630 | 258 | Not applicable |
| Class 529-A | 183 | 122 | 12 | $ 113 |
| Class 529-B | 213 | 23 | 10 | 21 |
| Class 529-C | 497 | 54 | 19 | 50 |
| Class 529-E | 34 | 7 | 1 | 7 |
| Class 529-F | 3 | 7 | 1 | 6 |
| Class R-1 | 147 | 22 | 9 | Not applicable |
| Class R-2 | 1,607 | 320 | 934 | Not applicable |
| Class R-3 | 6,668 | 1,927 | 310 | Not applicable |
| Class R-4 | 3,674 | 2,288 | 56 | Not applicable |
| Class R-5 | Not applicable | 2,597 | 24 | Not applicable |
| Total | $80,151 | $15,744 | $11,255 | $1,793 | $197 |
Deferred Trustees’ compensation - Since the adoption of the deferred compensation plan in 1993, Trustees who are unaffiliated with CRMC may elect to defer the cash payment of part or all of their compensation. These deferred amounts, which remain as liabilities of the fund, are treated as if invested in shares of the fund or other American Funds. These amounts represent general, unsecured liabilities of the fund and vary according to the total returns of the selected funds. Trustees’ compensation of $308,000, shown on the accompanying financial statements, includes $187,000 in current fees (either paid in cash or deferred) and a net increase of $121,000 in the value of the deferred amounts.
Affiliated officers and Trustees - Officers and certain Trustees of the fund are or may be considered to be affiliated with CRMC, AFS and AFD. No affiliated officers or Trustees received any compensation directly from the fund.
5. Capital share transactions
Capital share transactions in the fund were as follows (dollars and shares in thousands):
| | | Sales(1) | Reinvestments of dividends | Repurchases(1) | Net (decrease) increase |
| Share class | | Amount | Shares | Amount | Shares | Amount | Shares | Amount | Shares |
| Six months ended September 30, 2005 | | | | | | | |
| Class A | | $2,851,669 | $77,010 | $0 | $0 | ($3,306,197) | ($89,824) | ($454,528) | ($12,814) |
| Class B | | 77,966 | 2,135 | 0 | 0 | (47,952) | (1,314) | 30,014 | 821 |
| Class C | | 272,717 | 7,515 | 0 | 0 | (95,611) | (2,645) | 177,106 | 4,870 |
| Class F | | 833,560 | 22,648 | 0 | 0 | (333,370) | (9,039) | 500,190 | 13,609 |
| Class 529-A | | 44,032 | 1,198 | 0 | 0 | (3,894) | (105) | 40,138 | 1,093 |
| Class 529-B | | 4,862 | 134 | 0 | 0 | (670) | (18) | 4,192 | 116 |
| Class 529-C | | 18,671 | 516 | 0 | 0 | (2,441) | (67) | 16,230 | 449 |
| Class 529-E | | 2,739 | 75 | 0 | 0 | (172) | (4) | 2,567 | 71 |
| Class 529-F | | 2,424 | 66 | 0 | 0 | (318) | (9) | 2,106 | 57 |
| Class R-1 | | 10,688 | 290 | 0 | 0 | (6,041) | (171) | 4,647 | 119 |
| Class R-2 | | 124,531 | 3,427 | 0 | 0 | (48,052) | (1,317) | 76,479 | 2,110 |
| Class R-3 | | 766,305 | 21,090 | 0 | 0 | (283,623) | (7,808) | 482,682 | 13,282 |
| Class R-4 | | 812,576 | 22,359 | 0 | 0 | (315,253) | (8,654) | 497,323 | 13,705 |
| Class R-5 | | 1,339,958 | 36,525 | 0 | 0 | (359,521) | (9,725) | 980,437 | 26,800 |
| Total net increase | | | | | | | | | |
| (decrease) | | $7,162,698 | $194,988 | $0 | $0 | ($4,803,115) | ($130,700) | $2,359,583 | $64,288 |
| | | | | | | | | | |
| Year ended March 31, 2005 | | | | | | | |
| Class A | | $6,368,083 | $191,318 | $487,060 | $14,175 | ($5,554,993) | ($168,189) | $1,300,150 | $37,304 |
| Class B | | 193,292 | 5,893 | 7,274 | 213 | (69,186) | (2,113) | 131,380 | 3,993 |
| Class C | | 582,150 | 17,757 | 11,548 | 341 | (115,140) | (3,500) | 478,558 | 14,598 |
| Class F | | 1,528,316 | 46,074 | 43,192 | 1,261 | (451,133) | (13,620) | 1,120,375 | 33,715 |
| Class 529-A | | 80,293 | 2,409 | 2,348 | 69 | (5,367) | (161) | 77,274 | 2,317 |
| Class 529-B | | 11,969 | 367 | 270 | 8 | (719) | (22) | 11,520 | 353 |
| Class 529-C | | 33,743 | 1,025 | 603 | 18 | (3,273) | (99) | 31,073 | 944 |
| Class 529-E | | 4,422 | 133 | 119 | 3 | (335) | (10) | 4,206 | 126 |
| Class 529-F | | 5,238 | 159 | 132 | 4 | (862) | (27) | 4,508 | 136 |
| Class R-1 | | 22,982 | 695 | 240 | 7 | (3,933) | (122) | 19,289 | 580 |
| Class R-2 | | 229,096 | 6,970 | 2,900 | 86 | (59,582) | (1,829) | 172,414 | 5,227 |
| Class R-3 | | 1,409,987 | 42,745 | 23,844 | 701 | (347,312) | (10,487) | 1,086,519 | 32,959 |
| Class R-4 | | 1,692,744 | 51,340 | 31,296 | 921 | (367,006) | (11,172) | 1,357,034 | 41,089 |
| Class R-5 | | 2,246,312 | 66,636 | 60,479 | 1,760 | (623,129) | (18,573) | 1,683,662 | 49,823 |
| Total net increase | | | | | | | | | |
| (decrease) | | $14,408,627 | $433,521 | $671,305 | $19,567 | ($7,601,970) | ($229,924) | $7,477,962 | $223,164 |
| | | | | | | | | | |
| (1) Includes exchanges between share classes of the fund. | | | | | |
6. Forward currency contracts
As of September 30, 2005, the fund had outstanding forward currency contracts to sell non-U.S. currencies as follows (dollars in thousands):
Non-U.S. currency contracts | | | Contract amount | | | U.S. valuations at September 30, 2005 | |
| | | | Non-U.S. | | | U.S. | | | Amount | | | | |
| Sales: | | | | | | | | | | | | | |
| South African Rand | | | | | | | | | | | | | |
| expiring 1/9/2006 | | | ZAR173,478 | | $ | 24,815 | | $ | 27,009 | | $ | (2,194 | ) |
7. Investment transactions and other disclosures
The fund made purchases and sales of investment securities, excluding short-term securities, of $11,679,157,000 and $7,826,555,000, respectively, during the six months ended September 30, 2005.
The fund receives a reduction in its custodian fee equal to the amount of interest calculated on certain cash balances held at the custodian bank. For the six months ended September 30, 2005, the custodian fee of $8,734,000, shown on the accompanying financial statements, includes $172,000 that was offset by this reduction, rather than paid in cash.
CollegeAmerica is a registered trademark of and sponsored by the Virginia College Savings Plan.SM
Financial highlights (1) | | | | | | | | | | | | | |
| | | | | | | | | | | | | | |
| | Income (loss) from investment operations(2) | Dividends and distributions | | | | | | |
| | Net asset value, beginning of period | Net investment income | Net gains (losses) on securities (both realized and unrealized) | Total from investment operations | Dividends (from net investment income) | Distributions (from capital gains) | Total dividends and distributions | Net asset value, end of period | Total return (3) | Net assets, end of period (in millions) | Ratio of expenses to average net assets before reimbursements/ waivers | Ratio of expenses to average net assets after reimbursements/ waivers(4) | Ratio of net income to average net assets |
| Class A: | | | | | | | | | | | | | |
| Six months ended 9/30/2005 (5) | $35.63 | $.43 | $4.24 | $4.67 | $ - | $ - | $ - | $40.30 | 13.13% | $41,921 | 0.82% (6) | .78% (6) | 2.32% (6) |
| Year ended 3/31/2005 | 32.26 | .43 | 3.45 | 3.88 | (.51) | - | (.51) | 35.63 | 12.08 | 37,515 | .83 | .82 | 1.31 |
| Year ended 3/31/2004 | 20.78 | .29 | 11.50 | 11.79 | (.31) | - | (.31) | 32.26 | 57.11 | 32,759 | .87 | .87 | 1.08 |
| Year ended 3/31/2003 | 27.23 | .25 | (6.46) | (6.21) | (.24) | - | (.24) | 20.78 | (23.16) | 20,143 | .90 | .90 | 1.06 |
| Year ended 3/31/2002 | 28.72 | .33 | (1.16) | (.83) | (.66) | - | (.66) | 27.23 | (2.63) | 27,765 | .88 | .88 | 1.21 |
| Year ended 3/31/2001 | 44.61 | .69 | (12.65) | (11.96) | (.19) | (3.74) | (3.93) | 28.72 | (28.02) | 28,963 | .84 | .84 | 1.89 |
| Class B: | | | | | | | | | | | | | |
| Six months ended 9/30/2005 (5) | 35.29 | .29 | 4.20 | 4.49 | - | - | - | 39.78 | 12.72 | 1,108 | 1.57 (6) | 1.52 (6) | 1.56 (6) |
| Year ended 3/31/2005 | 32.00 | .18 | 3.41 | 3.59 | (.30) | - | (.30) | 35.29 | 11.24 | 954 | 1.58 | 1.56 | .55 |
| Year ended 3/31/2004 | 20.65 | .08 | 11.41 | 11.49 | (.14) | - | (.14) | 32.00 | 55.95 | 737 | 1.62 | 1.62 | .31 |
| Year ended 3/31/2003 | 27.09 | .07 | (6.43) | (6.36) | (.08) | - | (.08) | 20.65 | (23.79) | 387 | 1.68 | 1.68 | .28 |
| Year ended 3/31/2002 | 28.56 | .11 | (1.14) | (1.03) | (.44) | - | (.44) | 27.09 | (3.34) | 422 | 1.65 | 1.65 | .41 |
| Year ended 3/31/2001 | 44.59 | .47 | (12.65) | (12.18) | (.11) | (3.74) | (3.85) | 28.56 | (28.53) | 321 | 1.61 | 1.61 | 1.40 |
| Class C: | | | | | | | | | | | | | |
| Six months ended 9/30/2005 (5) | 35.04 | .26 | 4.18 | 4.44 | - | - | - | 39.48 | 12.67 | 1,934 | 1.65 (6) | 1.61 (6) | 1.46 (6) |
| Year ended 3/31/2005 | 31.81 | .14 | 3.40 | 3.54 | (.31) | - | (.31) | 35.04 | 11.16 | 1,546 | 1.67 | 1.65 | .44 |
| Year ended 3/31/2004 | 20.58 | .06 | 11.37 | 11.43 | (.20) | - | (.20) | 31.81 | 55.76 | 939 | 1.70 | 1.70 | .19 |
| Year ended 3/31/2003 | 27.07 | .05 | (6.42) | (6.37) | (.12) | - | (.12) | 20.58 | (23.80) | 275 | 1.74 | 1.74 | .19 |
| Year ended 3/31/2002 | 28.56 | .06 | (1.14) | (1.08) | (.41) | - | (.41) | 27.07 | (3.53) | 178 | 1.77 | 1.77 | .22 |
| Period from 3/15/2001 to 3/31/2001 | 28.87 | .06 | (.37) | (.31) | - | - | - | 28.56 | (1.07) | 10 | .08 | .08 | .18 |
| Class F: | | | | | | | | | | | | | |
| Six months ended 9/30/2005 (5) | 35.52 | .41 | 4.24 | 4.65 | - | - | - | 40.17 | 13.09 | 4,958 | .87 (6) | .82 (6) | 2.23 (6) |
| Year ended 3/31/2005 | 32.18 | .40 | 3.45 | 3.85 | (.51) | - | (.51) | 35.52 | 12.01 | 3,901 | .90 | .89 | 1.20 |
| Year ended 3/31/2004 | 20.75 | .27 | 11.48 | 11.75 | (.32) | - | (.32) | 32.18 | 57.02 | 2,449 | .92 | .92 | .97 |
| Year ended 3/31/2003 | 27.23 | .24 | (6.46) | (6.22) | (.26) | - | (.26) | 20.75 | (23.21) | 861 | .94 | .94 | 1.00 |
| Year ended 3/31/2002 | 28.72 | .26 | (1.11) | (.85) | (.64) | - | (.64) | 27.23 | (2.71) | 580 | .95 | .95 | .98 |
| Period from 3/15/2001 to 3/31/2001 | 29.02 | .07 | (.37) | (.30) | - | - | - | 28.72 | (1.03) | 7 | .05 | .05 | .22 |
| Class 529-A: | | | | | | | | | | | | | |
| Six months ended 9/30/2005 (5) | 35.49 | .41 | 4.23 | 4.64 | - | - | - | 40.13 | 13.07 | 267 | .87 (6) | .83 (6) | 2.21 (6) |
| Year ended 3/31/2005 | 32.15 | .39 | 3.46 | 3.85 | (.51) | - | (.51) | 35.49 | 12.04 | 197 | .91 | .89 | 1.18 |
| Year ended 3/31/2004 | 20.74 | .27 | 11.47 | 11.74 | (.33) | - | (.33) | 32.15 | 57.00 | 104 | .91 | .91 | .98 |
| Year ended 3/31/2003 | 27.23 | .23 | (6.45) | (6.22) | (.27) | - | (.27) | 20.74 | (23.22) | 33 | .94 | .94 | .98 |
| Period from 2/15/2002 to 3/31/2002 | 26.02 | .11 | 1.10 | 1.21 | - | - | - | 27.23 | 4.88 | 4 | .13 | .13 | .42 |
| Class 529-B: | | | | | | | | | | | | | |
| Six months ended 9/30/2005 (5) | 35.09 | .25 | 4.17 | 4.42 | - | - | - | 39.51 | 12.60 | 48 | 1.75 (6) | 1.70 (6) | 1.36 (6) |
| Year ended 3/31/2005 | 31.86 | .10 | 3.40 | 3.50 | (.27) | - | (.27) | 35.09 | 11.01 | 39 | 1.80 | 1.79 | .30 |
| Year ended 3/31/2004 | 20.61 | .02 | 11.38 | 11.40 | (.15) | - | (.15) | 31.86 | 55.61 | 24 | 1.83 | 1.83 | .06 |
| Year ended 3/31/2003 | 27.21 | .02 | (6.43) | (6.41) | (.19) | - | (.19) | 20.61 | (23.91) | 8 | 1.86 | 1.86 | .07 |
| Period from 2/19/2002 to 3/31/2002 | 25.54 | .08 | 1.59 | 1.67 | - | - | - | 27.21 | 6.77 | 1 | .20 | .20 | .29 |
| Class 529-C: | | | | | | | | | | | | | |
| Six months ended 9/30/2005 (5) | 35.08 | .25 | 4.18 | 4.43 | - | - | - | 39.51 | 12.63 | 117 | 1.73 (6) | 1.69 (6) | 1.35 (6) |
| Year ended 3/31/2005 | 31.86 | .10 | 3.40 | 3.50 | (.28) | - | (.28) | 35.08 | 11.02 | 88 | 1.79 | 1.78 | .31 |
| Year ended 3/31/2004 | 20.61 | .02 | 11.39 | 11.41 | (.16) | - | (.16) | 31.86 | 55.66 | 50 | 1.82 | 1.82 | .07 |
| Year ended 3/31/2003 | 27.20 | .02 | (6.42) | (6.40) | (.19) | - | (.19) | 20.61 | (23.88) | 15 | 1.84 | 1.84 | .08 |
| Period from 2/15/2002 to 3/31/2002 | 26.02 | .09 | 1.09 | 1.18 | - | - | - | 27.20 | 4.77 | 1 | .22 | .22 | .35 |
| Class 529-E: | | | | | | | | | | | | | |
| Six months ended 9/30/2005 (5) | 35.33 | .34 | 4.21 | 4.55 | - | - | - | 39.88 | 12.91 | 16 | 1.21 (6) | 1.16 (6) | 1.87 (6) |
| Year ended 3/31/2005 | 32.04 | .28 | 3.43 | 3.71 | (.42) | - | (.42) | 35.33 | 11.63 | 12 | 1.26 | 1.24 | .84 |
| Year ended 3/31/2004 | 20.69 | .17 | 11.44 | 11.61 | (.26) | - | (.26) | 32.04 | 56.45 | 7 | 1.28 | 1.28 | .61 |
| Year ended 3/31/2003 | 27.23 | .15 | (6.44) | (6.29) | (.25) | - | (.25) | 20.69 | (23.48) | 2 | 1.30 | 1.30 | .66 |
| Period from 3/7/2002 to 3/31/2002 | 27.39 | .06 | (.22) | (.16) | - | - | - | 27.23 | (.36) | - (7) | .09 | .09 | .23 |
| Class 529-F: | | | | | | | | | | | | | |
| Six months ended 9/30/2005 (5) | 35.45 | .43 | 4.24 | 4.67 | - | - | - | 40.12 | 13.17 | 16 | .76 (6) | .72 (6) | 2.33 (6) |
| Year ended 3/31/2005 | 32.13 | .36 | 3.44 | 3.80 | (.48) | - | (.48) | 35.45 | 11.89 | 12 | 1.01 | .99 | 1.09 |
| Year ended 3/31/2004 | 20.74 | .24 | 11.48 | 11.72 | (.33) | - | (.33) | 32.13 | 56.79 | 6 | 1.02 | 1.02 | .82 |
| Period from 9/16/2002 to 3/31/2003 | 22.67 | .16 | (1.83) | (1.67) | (.26) | - | (.26) | 20.74 | (7.57) | 1 | 1.05 (6) | 1.05 (6) | 1.31(6) |
| Class R-1: | | | | | | | | | | | | | |
| Six months ended 9/30/2005 (5) | $35.04 | $.27 | $4.17 | $4.44 | $ - | $ - | $ - | $39.48 | 12.64% | $37 | 1.65% (6) | 1.60% (6) | 1.48% (6) |
| Year ended 3/31/2005 | 31.89 | .11 | 3.43 | 3.54 | (.39) | - | (.39) | 35.04 | 11.18 | 29 | 1.72 | 1.68 | .34 |
| Year ended 3/31/2004 | 20.67 | .04 | 11.41 | 11.45 | (.23) | - | (.23) | 31.89 | 55.72 | 8 | 1.82 | 1.71 | .15 |
| Period from 6/17/2002 to 3/31/2003 | 26.26 | .06 | (5.41) | (5.35) | (.24) | - | (.24) | 20.67 | (20.56) | 1 | 2.84 (6) | 1.73 (6) | .32 (6) |
| Class R-2: | | | | | | | | | | | | | |
| Six months ended 9/30/2005 (5) | 35.07 | .26 | 4.18 | 4.44 | - | - | - | 39.51 | 12.66 | 506 | 1.82 (6) | 1.61 (6) | 1.43 (6) |
| Year ended 3/31/2005 | 31.86 | .14 | 3.41 | 3.55 | (.34) | - | (.34) | 35.07 | 11.17 | 375 | 1.90 | 1.64 | .42 |
| Year ended 3/31/2004 | 20.64 | .05 | 11.40 | 11.45 | (.23) | - | (.23) | 31.86 | 55.78 | 174 | 2.08 | 1.67 | .17 |
| Period from 5/31/2002 to 3/31/2003 | 27.34 | .10 | (6.55) | (6.45) | (.25) | - | (.25) | 20.64 | (23.80) | 29 | 2.33 (6) | 1.70 (6) | .53 (6) |
| Class R-3: | | | | | | | | | | | | | |
| Six months ended 9/30/2005 (5) | 35.23 | .35 | 4.21 | 4.56 | - | - | - | 39.79 | 12.94 | 3,150 | 1.15 (6) | 1.11 (6) | 1.94 (6) |
| Year ended 3/31/2005 | 31.96 | .30 | 3.42 | 3.72 | (.45) | - | (.45) | 35.23 | 11.68 | 2,321 | 1.18 | 1.16 | .89 |
| Year ended 3/31/2004 | 20.68 | .15 | 11.45 | 11.60 | (.32) | - | (.32) | 31.96 | 56.46 | 1,052 | 1.29 | 1.29 | .51 |
| Period from 5/21/2002 to 3/31/2003 | 27.64 | .17 | (6.86) | (6.69) | (.27) | - | (.27) | 20.68 | (24.40) | 63 | 1.35 (6) | 1.31 (6) | .87 (6) |
| Class R-4: | | | | | | | | | | | | | |
| Six months ended 9/30/2005 (5) | 35.25 | .41 | 4.21 | 4.62 | - | - | - | 39.87 | 13.11 | 3,564 | .88 (6) | .83 (6) | 2.22 (6) |
| Year ended 3/31/2005 | 31.95 | .39 | 3.44 | 3.83 | (.53) | - | (.53) | 35.25 | 12.04 | 2,668 | .90 | .88 | 1.17 |
| Year ended 3/31/2004 | 20.63 | .27 | 11.41 | 11.68 | (.36) | - | (.36) | 31.95 | 57.00 | 1,106 | .92 | .92 | .92 |
| Period from 6/7/2002 to 3/31/2003 | 26.69 | .22 | (6.00) | (5.78) | (.28) | - | (.28) | 20.63 | (21.87) | 76 | .96 (6) | .96 (6) | 1.27 (6) |
| Class R-5: | | | | | | | | | | | | | |
| Six months ended 9/30/2005 (5) | 35.64 | .46 | 4.26 | 4.72 | - | - | - | 40.36 | 13.24 | 6,186 | .59 (6) | .54 (6) | 2.48 (6) |
| Year ended 3/31/2005 | 32.26 | .50 | 3.47 | 3.97 | (.59) | - | (.59) | 35.64 | 12.38 | 4,507 | .59 | .58 | 1.51 |
| Year ended 3/31/2004 | 20.78 | .35 | 11.51 | 11.86 | (.38) | - | (.38) | 32.26 | 57.49 | 2,473 | .61 | .61 | 1.27 |
| Period from 5/15/2002 to 3/31/2003 | 27.55 | .26 | (6.74) | (6.48) | (.29) | - | (.29) | 20.78 | (23.71) | 782 | .63 (6) | .63 (6) | 1.31 (6) |
| | | | Six months ended September 30, | | | Year ended March 31 | |
| | | | 2005(5 | ) | | | | | 2005 | | | 2004 | | | 2003 | | | 2002 | | | 2001 | |
| | | | | | | | | | | | | | | | | | | | | | | |
| Portfolio turnover rate for all classes of shares | | | 15 | % | | | | | 30 | % | | 25 | % | | 29 | % | | 27 | % | | 37 | % |
| (1) Based on operations for the period shown (unless otherwise noted) and, accordingly, may not be representative of a full year. |
| (2) Based on average shares outstanding. |
| (3) Total returns exclude all sales charges, including contingent deferred sales charges. |
| (4) The ratios in this column reflect the impact, if any, of certain reimbursements/waivers from CRMC. During some of the period shown, |
| CRMC reduced fees for investment advisory services for all share classes. In addition, during the start-up period for the retirement plan share |
| to classes (except Class R-5), CRMC agreed pay a portion of the fees related to transfer agent services. |
| (5) Unaudited. |
| (6) Annualized. |
| (7) Amount less than $1 million. |
| |
| See Notes to Financial Statements |
Expense example unaudited
As a shareholder of the fund, you incur two types of costs: (1) transaction costs such as initial sales charges on purchase payments and contingent deferred sales charges on redemptions (loads); and (2) ongoing costs, including management fees; distribution and service (12b-1) fees; and other expenses. This example is intended to help you understand your ongoing costs (in dollars) of investing in the fund so you can compare these costs with the ongoing costs of investing in other mutual funds. The example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period (April 1, 2005, through September 30, 2005).
Actual expenses:
The first line of each share class in the table on the next page provides information about actual account values and actual expenses. You may use the information in this line, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the first line under the heading entitled "Expenses paid during period" to estimate the expenses you paid on your account during this period. There are some account fees that are charged to certain types of accounts, such as Individual Retirement Accounts and CollegeAmerica accounts (generally, a $10 fee is charged to set up the account and an additional $10 fee is charged to the account annually) that would increase the amount of expenses paid on your account. In addition, retirement plan participants may be subject to certain fees charged by the plan sponsor, and Class F and Class 529-F shareholders may be subject to fees charged by financial intermediaries, typically ranging from 0.75% to 1.50% of assets annually depending on services offered. You can estimate the impact of these fees by adding the amount of the fees to the total estimated expenses you paid on your account during the period as calculated above. In addition, your ending account value would also be lower by the amount of these fees.
Hypothetical example for comparison purposes:
The second line of each share class in the table on the next page provides information about hypothetical account values and hypothetical expenses based on the actual expense ratio for the share class and an assumed rate of return of 5.00% per year before expenses, which is not the actual return of the share class. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the fund and other funds. To do so, compare this 5.00% hypothetical example with the 5.00% hypothetical examples that appear in the shareholder reports of the other funds. There are some account fees that are charged to certain types of accounts, such as Individual Retirement Accounts and CollegeAmerica accounts (generally, a $10 fee is charged to set up the account and an additional $10 fee is charged to the account annually) that would increase the amount of expenses paid on your account. In addition, retirement plan participants may be subject to certain fees charged by the plan sponsor, and Class F and Class 529-F shareholders may be subject to fees charged by financial intermediaries, typically ranging from 0.75% to 1.50% of assets annually depending on services offered. You can estimate the impact of these fees by adding the amount of the fees to the total estimated expenses you paid on your account during the period as calculated on the previous page. In addition, your ending account value would also be lower by the amount of these fees.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as sales charges (loads). Therefore, the second line of each share class in the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.
| | | | Beginning account value 4/1/2005 | | | Ending account value 9/30/2005 | | | Expenses paid during period(1) | | | Annualized expense ratio | |
| | | | | | | | | | | | | | |
| Class A -- actual return | | $ | 1,000.00 | | $ | 1,131.34 | | $ | 4.17 | | | .78 | % |
| Class A -- assumed 5% return | | | 1,000.00 | | | 1,021.16 | | | 3.95 | | | .78 | |
| | | | | | | | | | | | | | |
| Class B -- actual return | | | 1,000.00 | | | 1,127.25 | | | 8.11 | | | 1.52 | |
| Class B -- assumed 5% return | | | 1,000.00 | | | 1,017.45 | | | 7.69 | | | 1.52 | |
| | | | | | | | | | | | | | |
| Class C -- actual return | | | 1,000.00 | | | 1,126.72 | | | 8.58 | | | 1.61 | |
| Class C -- assumed 5% return | | | 1,000.00 | | | 1,017.00 | | | 8.14 | | | 1.61 | |
| | | | | | | | | | | | | | |
| Class F -- actual return | | | 1,000.00 | | | 1,130.91 | | | 4.38 | | | .82 | |
| Class F -- assumed 5% return | | | 1,000.00 | | | 1,020.96 | | | 4.15 | | | .82 | |
| | | | | | | | | | | | | | |
| Class 529-A -- actual return | | | 1,000.00 | | | 1,130.74 | | | 4.43 | | | .83 | |
| Class 529-A -- assumed 5% return | | | 1,000.00 | | | 1,020.91 | | | 4.20 | | | .83 | |
| | | | | | | | | | | | | | |
| Class 529-B -- actual return | | | 1,000.00 | | | 1,125.96 | | | 9.06 | | | 1.70 | |
| Class 529-B -- assumed 5% return | | | 1,000.00 | | | 1,016.55 | | | 8.59 | | | 1.70 | |
| | | | | | | | | | | | | | |
| Class 529-C -- actual return | | | 1,000.00 | | | 1,126.27 | | | 9.01 | | | 1.69 | |
| Class 529-C -- assumed 5% return | | | 1,000.00 | | | 1,016.60 | | | 8.54 | | | 1.69 | |
| | | | | | | | | | | | | | |
| Class 529-E -- actual return | | | 1,000.00 | | | 1,129.09 | | | 6.19 | | | 1.16 | |
| Class 529-E -- assumed 5% return | | | 1,000.00 | | | 1,019.25 | | | 5.87 | | | 1.16 | |
| | | | | | | | | | | | | | |
| Class 529-F -- actual return | | | 1,000.00 | | | 1,131.75 | | | 3.85 | | | .72 | |
| Class 529-F -- assumed 5% return | | | 1,000.00 | | | 1,021.46 | | | 3.65 | | | .72 | |
| | | | | | | | | | | | | | |
| Class R-1 -- actual return | | | 1,000.00 | | | 1,126.40 | | | 8.53 | | | 1.60 | |
| Class R-1 -- assumed 5% return | | | 1,000.00 | | | 1,017.05 | | | 8.09 | | | 1.60 | |
| | | | | | | | | | | | | | |
| Class R-2 -- actual return | | | 1,000.00 | | | 1,126.59 | | | 8.58 | | | 1.61 | |
| Class R-2 -- assumed 5% return | | | 1,000.00 | | | 1,017.00 | | | 8.14 | | | 1.61 | |
| | | | | | | | | | | | | | |
| Class R-3 -- actual return | | | 1,000.00 | | | 1,129.44 | | | 5.93 | | | 1.11 | |
| Class R-3 -- assumed 5% return | | | 1,000.00 | | | 1,019.50 | | | 5.62 | | | 1.11 | |
| | | | | | | | | | | | | | |
| Class R-4 -- actual return | | | 1,000.00 | | | 1,131.07 | | | 4.43 | | | .83 | |
| Class R-4 -- assumed 5% return | | | 1,000.00 | | | 1,020.91 | | | 4.20 | | | .83 | |
| | | | | | | | | | | | | | |
| Class R-5 -- actual return | | | 1,000.00 | | | 1,132.42 | | | 2.89 | | | .54 | |
| Class R-5 -- assumed 5% return | | | 1,000.00 | | | 1,022.36 | | | 2.74 | | | .54 | |
| | | | | | | | | | | | | | |
(1) Expenses are equal to the annualized expense ratio, multiplied by the average account value over the period, multiplied by the |
| number of days in the period (183), and divided by 365 (to reflect the one-half year period). |
Offices of the fund and of the investment adviser
Capital Research and Management Company
333 South Hope Street
Los Angeles, CA 90071-1406
135 South State College Boulevard
Brea, CA 92821-5823
Transfer agent for shareholder accounts
American Funds Service Company
(Please write to the address nearest you.)
P.O. Box 25065
Santa Ana, CA 92799-5065
P.O. Box 659522
San Antonio, TX 78265-9522
P.O. Box 6007
Indianapolis, IN 46206-6007
P.O. Box 2280
Norfolk, VA 23501-2280
Custodian of assets
JPMorgan Chase Bank
270 Park Avenue
New York, NY 10017-2070
Counsel
Kirkpatrick & Lockhart Nicholson Graham LLP
Four Embarcadero Center
San Francisco, CA 94111-4121
Independent registered public accounting firm
Deloitte & Touche LLP
695 Town Center Drive
Suite 1200
Costa Mesa, CA 92626-7188
Principal underwriter
American Funds Distributors, Inc.
333 South Hope Street
Los Angeles, CA 90071-1406
There are several ways to invest in EuroPacific Growth Fund. Class A shares are subject to a 5.75% maximum up-front sales charge that declines for accounts (and aggregated investments) of $25,000 or more and is eliminated for purchases of $1 million or more. Other share classes, which are generally not available for certain employer-sponsored retirement plans, have no up-front sales charges but are subject to additional annual expenses and fees. Annualized expenses for Class B shares were 0.74 percentage points higher than for Class A shares; Class B shares convert to Class A shares after eight years of ownership. If redeemed within six years, Class B shares may also be subject to a contingent deferred sales charge (“CDSC”) of up to 5% that declines over time. Class C shares were subject to annualized expenses 0.83 percentage points higher than those for Class A shares and a 1% CDSC if redeemed within the first year after purchase. Class C shares convert to Class F shares after 10 years. Class F shares, which are available only through certain fee-based programs offered by broker-dealer firms and registered investment advisers, had higher annualized expenses (by 0.04 percentage points) than did Class A shares, and an annual asset-based fee charged by the sponsoring firm. Expenses are deducted from income earned by the fund. As a result, dividends and investment results will differ for each share class.
Investors should carefully consider the investment objectives, risks, charges and expenses of the American Funds and CollegeAmerica. This and other important information is contained in the fund’s prospectus and the CollegeAmerica program description, which can be obtained from your financial adviser and should be read carefully before investing. You may also call American Funds Service Company (AFS) at 800/421-0180 or visit the American Funds website at americanfunds.com. If you reside in a state other than Virginia, there may be an in-state plan that provides tax and other benefits not available through CollegeAmerica. Talk to your tax adviser. CollegeAmerica is distributed by American Funds Distributors and sold through unaffiliated intermediaries.
“American Funds Proxy Voting Guidelines” — which describes how we vote proxies relating to portfolio securities — is available free of charge on the U.S. Securities and Exchange Commission (SEC) website at www.sec.gov, on the American Funds website or upon request by calling AFS. The fund files its proxy voting record with the SEC for the 12 months ended June 30 by August 31. The report also is available on the SEC and American Funds websites.
A complete September 30, 2005, portfolio of EuroPacific Growth Fund’s investments is available free of charge by calling AFS or visiting the SEC website (where it is part of Form N-CSR).
EuroPacific Growth Fund files a complete list of its portfolio holdings with the SEC for the first and third quarters of each fiscal year on Form N-Q. This filing is available free of charge on the SEC website. You may also review or, for a fee, copy this filing at the SEC’s Public Reference Room in Washington, D.C. (800/SEC-0330). Additionally, the list of portfolio holdings also is available by calling AFS.
This report is for the information of shareholders of EuroPacific Growth Fund but it may also be used as sales literature when preceded or accompanied by the current prospectus, which gives details about charges, expenses, investment objectives and operating policies of the fund. If used as sales material after December 31, 2005, this report must be accompanied by an American Funds statistical update for the most recently completed calendar quarter.
[logo - American Funds®]
CollegeAmerica is sponsored by
Virginia College Savings PlanSM
What makes American Funds different?
For more than 70 years, we have followed a consistent philosophy that we firmly believe is in our investors’ best interests. The range of opportunities offered by our family of just 29 carefully conceived, broadly diversified funds has attracted over 30 million shareholder accounts.
Our unique combination of strengths includes these five factors:
| • | A long-term, value-oriented approach |
| | Rather than follow fads, we pursue a consistent strategy, focusing on each investment’s long-term potential. |
| • | An unparalleled global research effort |
| | American Funds draws on one of the industry’s most globally integrated research networks. |
| • | The multiple portfolio counselor system |
Every American Fund is divided among a number of portfolio counselors. Each takes responsibility for a portion independently, within each fund’s objectives; in most cases, research analysts manage a portion as well. Over time this method has contributed to a consistency of results and continuity of management.
| • | Experienced investment professionals |
| | The recent market decline was not the first for most of the portfolio counselors who serve the American Funds. More than half of them were in the investment business before the sharp market decline of 1987. |
| • | A commitment to low operating expenses |
| | American Funds’ operating expenses are among the lowest in the mutual fund industry. Our portfolio turnover rates are low as well, keeping transaction costs and tax consequences contained. |
29 mutual funds, consistent philosophy, consistent results
• Growth funds
AMCAP Fund®
> EuroPacific Growth Fund®
The Growth Fund of America®
The New Economy Fund®
New Perspective Fund®
New World FundSM
SMALLCAP World Fund®
• Growth-and-income funds
American Mutual Fund®
Capital World Growth and Income FundSM
Fundamental InvestorsSM
The Investment Company of America®
Washington Mutual Investors FundSM
• Equity-income funds
Capital Income Builder®
The Income Fund of America®
• Balanced fund
American Balanced Fund®
• Bond funds
American High-Income TrustSM
The Bond Fund of AmericaSM
Capital World Bond Fund®
Intermediate Bond Fund of America®
U.S. Government Securities FundSM
• Tax-exempt bond funds
American High-Income Municipal Bond Fund®
Limited Term Tax-Exempt Bond Fund of AmericaSM
The Tax-Exempt Bond Fund of America®
State-specific tax-exempt funds
The Tax-Exempt Fund of California®
The Tax-Exempt Fund of Maryland®
The Tax-Exempt Fund of Virginia®
• Money market funds
The Cash Management Trust of America®
The Tax-Exempt Money Fund of AmericaSM
The U.S. Treasury Money Fund of AmericaSM
The Capital Group Companies
American Funds
Capital Research and Management
Capital International
Capital Guardian
Capital Bank and Trust
Lit. No. MFGESR-916-1105P
Litho in USA BG/AL/8082-S4901
Printed on recycled paper
ITEM 2 - Code of Ethics
Not applicable for filing of Semiannual Reports to Shareholders.
ITEM 3 - Audit Committee Financial Expert
Not applicable for filing of Semiannual Reports to Shareholders.
ITEM 4 - Principal Accountant Fees and Services
Not applicable for filing of Semiannual Reports to Shareholders.
ITEM 5 - Audit Committee of Listed Registrants
Not applicable to this Registrant, insofar as the Registrant is not a listed issuer as defined in Rule 10A-3 under the Securities Exchange Act of 1934.
ITEM 6 - Schedule of Investments
[logo - American Funds ®]
EuroPacific Growth Fund®
Investment portfolio
September 30, 2005
| | | Market value |
| Common stocks — 94.51% | Shares | (000) |
| | | |
FINANCIALS — 23.34% | | |
UFJ Holdings, Inc.1,2 | 118,513 | $964,962 |
Kookmin Bank2 | 15,593,040 | 917,718 |
Allianz AG2 | 4,311,335 | 584,107 |
Mitsui Trust Holdings, Inc.2 | 39,187,000 | 541,571 |
ABN AMRO Holding NV2 | 22,564,802 | 540,559 |
ING Groep NV2 | 17,377,817 | 518,202 |
| Banco Bradesco SA, preferred nominative | 9,660,600 | 473,030 |
Banco Santander Central Hispano, SA2 | 32,275,106 | 424,917 |
Shinhan Financial Group Co., Ltd.2 | 11,949,400 | 416,605 |
UBS AG2 | 4,868,398 | 413,487 |
| Banco Itaú Holding Financeira SA, preferred nominative | 1,580,600 | 378,789 |
Hypo Real Estate Holding AG2 | 6,680,000 | 337,557 |
DnB NOR ASA2 | 32,600,000 | 337,202 |
Sun Hung Kai Properties Ltd.2 | 31,951,000 | 331,596 |
Promise Co., Ltd.2 | 4,470,150 | 331,357 |
HSBC Holdings PLC (United Kingdom)2 | 13,747,439 | 222,669 |
HSBC Holdings PLC (Hong Kong)2 | 6,568,436 | 106,724 |
Mitsui Sumitomo Insurance Co., Ltd.2 | 27,031,000 | 312,195 |
| Unibanco-União de Bancos Brasileiros SA, units (GDR) | 5,610,000 | 295,086 |
Housing Development Finance Corp. Ltd.2 | 11,947,500 | 283,012 |
Royal Bank of Scotland Group PLC2 | 9,947,308 | 282,788 |
Macquarie Bank Ltd.2 | 4,677,280 | 268,969 |
UniCredito Italiano SpA2 | 47,070,000 | 265,560 |
Lloyds TSB Group PLC2 | 31,000,000 | 255,819 |
Hongkong Land Holdings Ltd.2 | 80,980,300 | 254,923 |
Swire Pacific Ltd., Class A2 | 27,195,500 | 250,861 |
Sompo Japan Insurance Inc.2 | 18,399,000 | 243,705 |
ORIX Corp.2 | 1,157,000 | 208,911 |
| ORIX Corp. (ADR) | 189,600 | 17,176 |
Millea Holdings, Inc.2 | 13,063 | 209,485 |
QBE Insurance Group Ltd.2 | 14,700,760 | 209,041 |
DEPFA BANK PLC2 | 12,890,000 | 207,283 |
| Brascan Corp., Class A | 4,413,000 | 205,788 |
Société Générale2 | 1,702,000 | 193,939 |
HBOS PLC2 | 12,505,955 | 188,354 |
NIPPONKOA Insurance Co., Ltd.2 | 24,280,000 | 188,308 |
Mizuho Financial Group, Inc.2 | 28,540 | 181,649 |
| Bank of Nova Scotia | 4,600,000 | 171,995 |
AIFUL Corp.2 | 1,901,200 | 159,023 |
| PartnerRe Holdings Ltd. | 2,437,850 | 156,144 |
Westfield Group2 | 12,067,114 | 154,483 |
Sumitomo Mitsui Financial Group, Inc.2 | 15,670 | $ 147,763 |
Crédit Agricole SA2 | 4,870,000 | 142,956 |
ICICI Bank Ltd.2 | 6,982,300 | 96,035 |
| ICICI Bank Ltd. (ADR) | 1,111,300 | 31,394 |
Credit Suisse Group2 | 2,865,000 | 127,032 |
| Takefuji Corp. | 1,600,840 | 124,736 |
DBS Group Holdings Ltd.2 | 12,450,000 | 116,149 |
Samsung Fire & Marine Insurance Co., Ltd.2 | 1,096,500 | 113,325 |
Banco Bilbao Vizcaya Argentaria, SA2 | 6,206,200 | 108,750 |
BNP Paribas2 | 1,275,056 | 97,063 |
| Sberbank (Savings Bank of the Russian Federation) (GDR) | 950,000 | 91,200 |
Chinatrust Financial Holding Co., Ltd.2 | 102,514,837 | 88,414 |
| Fairfax Financial Holdings Ltd. | 500,000 | 86,736 |
Westpac Banking Corp.2 | 5,119,760 | 82,540 |
Cathay Financial Holding Co., Ltd.2 | 33,050,000 | 61,738 |
Woori Finance Holdings Co., Ltd.2 | 4,000,000 | 58,138 |
Bayerische Hypo- und Vereinsbank AG1,2 | 2,000,000 | 56,445 |
St. George Bank Ltd.2 | 2,374,778 | 50,497 |
T&D Holdings, Inc.2 | 820,000 | 48,914 |
Deutsche Bank AG2 | 501,466 | 46,963 |
Malayan Banking Bhd.2 | 13,150,300 | 40,509 |
Mitsubishi Estate Co., Ltd.2 | 2,230,000 | 30,619 |
Fubon Financial Holding Co., Ltd.2 | 26,300,000 | 24,219 |
Erste Bank der oesterreichischen Sparkassen AG2 | 299,686 | 16,032 |
Security Capital European Realty1,2,3 | 39,607 | 633 |
| | | 14,894,349 |
| | | |
CONSUMER DISCRETIONARY — 11.89% | | |
Toyota Motor Corp.2 | 11,122,600 | 509,713 |
Honda Motor Co., Ltd.2 | 8,335,100 | 471,625 |
Hyundai Motor Co.2 | 5,861,120 | 460,852 |
Industria de Diseno Textil, SA2 | 14,300,468 | 420,172 |
Continental AG2 | 4,977,500 | 409,723 |
Bridgestone Corp.2 | 16,316,000 | 349,901 |
Swatch Group Ltd2 | 5,026,034 | 309,231 |
Mediaset SpA2 | 25,518,900 | 301,939 |
Sony Corp.2 | 8,939,700 | 293,848 |
| News Corp. Inc., Class A | 15,109,826 | 235,562 |
| News Corp. Inc., Class B | 1,848,614 | 30,502 |
| Grupo Televisa, SA, ordinary participation certificates (ADR) | 3,548,400 | 254,456 |
Volkswagen AG2 | 3,021,900 | 186,222 |
Volkswagen AG, nonvoting preferred2 | 1,333,000 | 60,910 |
Kingfisher PLC2 | 60,837,191 | 232,189 |
LG Electronics Inc.2 | 3,161,000 | 212,689 |
Daito Trust Construction Co., Ltd.2 | 4,515,000 | 197,866 |
Dixons Group PLC2 | 65,779,418 | 174,790 |
Suzuki Motor Corp.2 | 9,396,867 | 174,051 |
Reed Elsevier PLC2 | 18,680,000 | 172,630 |
Koninklijke Philips Electronics NV2 | 6,110,000 | 162,702 |
Publishing & Broadcasting Ltd.2 | 12,032,253 | 151,413 |
Marui Co., Ltd.2 | 8,700,000 | 147,090 |
Accor SA2 | 2,752,000 | 138,979 |
Esprit Holdings Ltd.2 | 17,700,000 | 132,597 |
Porsche AG, preferred shares2 | 167,790 | 129,001 |
Cie. Financière Richemont AG, units, Class A2 | 3,058,816 | 121,416 |
Fuji Heavy Industries Ltd.2 | 25,777,000 | $ 116,652 |
Reed Elsevier NV2 | 8,018,100 | 110,698 |
Yamada Denki Co., Ltd.2 | 1,386,000 | 105,407 |
Pearson PLC2 | 9,037,272 | 104,999 |
Nikon Corp.2 | 8,259,000 | 104,395 |
Premiere AG1,2 | 3,618,000 | 101,712 |
| Thomson Corp. | 2,460,000 | 91,959 |
British Sky Broadcasting Group PLC2 | 9,095,938 | 90,067 |
HYUNDAI MOBIS2 | 1,016,350 | 83,631 |
Sekisui House, Ltd.2 | 4,780,000 | 58,760 |
Marks and Spencer Group PLC2 | 7,600,000 | 50,311 |
Agfa-Gevaert NV2 | 1,900,000 | 45,813 |
Daiwa House Industry Co., Ltd.2 | 2,960,300 | 38,748 |
Funai Electric Co., Ltd.2 | 285,000 | 25,349 |
NEXT PLC2 | 385,000 | 9,452 |
Kesa Electricals PLC2 | 1,419,851 | 6,398 |
Antena 3 Televisión, SA2 | 64,652 | 1,173 |
TI Automotive Ltd., Class A1,2 | 3,197,300 | — |
| | | 7,587,593 |
| | | |
TELECOMMUNICATION SERVICES — 11.14% | | |
Vodafone Group PLC2 | 436,435,890 | 1,136,022 |
| América Móvil SA de CV, Series L (ADR) | 33,648,000 | 885,615 |
| América Móvil SA de CV, Series L | 21,540,000 | 28,387 |
Telefónica, SA2 | 38,798,154 | 636,759 |
France Télécom, SA2 | 16,793,000 | 483,453 |
Koninklijke KPN NV2 | 50,755,000 | 455,883 |
Telekom Austria AG2 | 19,684,056 | 391,588 |
| Teléfonos de México, SA de CV, Class L (ADR) | 14,060,000 | 299,056 |
| Teléfonos de México, SA de CV, Class L | 14,360,000 | 15,283 |
Bharti Tele-Ventures Ltd.1,2 | 37,635,300 | 299,054 |
| Tele Norte Leste Participações SA, preferred nominative | 16,764,775 | 277,200 |
| Tele Norte Leste Participações SA, ordinary nominative | 762,130 | 17,355 |
| Tele Norte Leste Participações SA, preferred nominative (ADR) | 130,000 | 2,149 |
Perusahaan Perseroan (Persero) PT Telekomunikasi Indonesia Tbk, Class B2 | 518,454,200 | 271,637 |
Deutsche Telekom AG2 | 12,675,500 | 231,147 |
China Mobile (Hong Kong) Ltd.2 | 45,344,000 | 222,809 |
KT Corp.2 | 2,335,060 | 98,716 |
| KT Corp. (ADR) | 3,057,880 | 68,802 |
| SK Telecom Co., Ltd. (ADR) | 7,611,750 | 166,241 |
Portugal Telecom, SGPS, SA2 | 15,795,000 | 144,295 |
Singapore Telecommunications Ltd.2 | 90,508,500 | 130,994 |
China Unicom Ltd.2 | 152,028,000 | 126,785 |
Telenor ASA2 | 13,525,800 | 120,727 |
BT Group PLC2 | 30,000,000 | 117,656 |
| BCE Inc. | 4,201,930 | 115,272 |
Advanced Info Service PCL2 | 42,980,000 | 113,386 |
KDDI Corp.2 | 20,000 | 112,762 |
Belgacom SA2 | 2,086,086 | 70,809 |
| China Netcom Group Corp. (Hong Kong) Ltd. (ADR) | 1,592,800 | 54,697 |
| Telecomunicações de Sao Paulo SA, preferred nominative | 684,461 | 13,424 |
| | | 7,107,963 |
| | | |
| | | |
INFORMATION TECHNOLOGY — 9.67% | | |
SOFTBANK CORP.2 | 17,154,900 | $ 952,850 |
Taiwan Semiconductor Manufacturing Co. Ltd.2 | 433,157,406 | 698,330 |
| Taiwan Semiconductor Manufacturing Co. Ltd. (ADR) | 9,556,400 | 78,554 |
Samsung Electronics Co., Ltd.2 | 1,076,775 | 608,104 |
Samsung Electronics Co., Ltd., nonvoting preferred2 | 48,800 | 21,273 |
Hon Hai Precision Industry Co., Ltd.2 | 130,046,846 | 607,756 |
Rohm Co., Ltd.2 | 4,272,100 | 370,910 |
Murata Manufacturing Co., Ltd.2 | 6,377,500 | 355,959 |
Hoya Corp., when-issued 11/20051,2 | 7,542,000 | 250,596 |
Hoya Corp.2 | 2,514,000 | 83,532 |
Tokyo Electron Ltd.2 | 5,704,300 | 303,547 |
Nippon Electric Glass Co., Ltd.2 | 15,969,000 | 288,245 |
Hirose Electric Co., Ltd.2 | 1,830,000 | 213,492 |
Mediatek Incorporation2 | 15,051,324 | 142,512 |
Chi Mei Optoelectronics Corp.2 | 124,073,598 | 137,641 |
livedoor Co., Ltd.1,2 | 34,609,000 | 136,363 |
SAP AG2 | 760,000 | 131,261 |
TDK Corp.2 | 1,800,000 | 128,407 |
OMRON Corp.2 | 4,800,000 | 116,807 |
Fujitsu Ltd.2 | 15,400,000 | 101,567 |
Advanced Semiconductor Engineering, Inc.2 | 116,643,491 | 78,977 |
| Telefonaktiebolaget LM Ericsson, Class B (ADR) | 1,600,000 | 58,944 |
Infosys Technologies Ltd.2 | 980,000 | 56,253 |
Canon, Inc.2 | 1,000,000 | 54,027 |
Wipro Ltd.2 | 6,000,000 | 50,726 |
ASML Holding NV1,2 | 2,500,000 | 41,223 |
ASML Holding NV (New York registered)1 | 213,000 | 3,517 |
Konica Minolta Holdings, Inc.2 | 4,601,000 | 41,852 |
Ricoh Co., Ltd.2 | 1,125,000 | 17,600 |
AU Optronics Corp.2 | 10,355,000 | 13,449 |
Seiko Epson Corp.2 | 500,000 | 12,878 |
Contax Participacoes, SA1 | 16,764,775 | 10,487 |
Contax Participações SA, ordinary nominative1 | 762,130 | 686 |
Contax Participações SA, preferred nominative (ADR)1 | 130,000 | 80 |
Samsung SDI Co., Ltd.2 | 65,020 | 6,788 |
| | | 6,175,193 |
| | | |
HEALTH CARE — 9.08% | | |
Roche Holding AG2 | 12,019,200 | 1,671,026 |
Sanofi-Aventis2 | 16,344,087 | 1,352,041 |
AstraZeneca PLC (Sweden)2 | 8,756,617 | 408,279 |
AstraZeneca PLC (United Kingdom)2 | 4,505,000 | 210,154 |
Novo Nordisk A/S, Class B2 | 12,425,650 | 614,758 |
Chugai Pharmaceutical Co., Ltd.2 | 19,547,200 | 372,872 |
UCB NV2 | 6,796,059 | 359,358 |
Novartis AG2 | 4,613,960 | 234,218 |
Shionogi & Co., Ltd.2 | 9,425,000 | 128,112 |
H. Lundbeck A/S2 | 4,084,300 | 103,809 |
Essilor2 | 1,250,000 | 103,584 |
Astellas Pharma Inc.2 | 2,400,000 | 90,318 |
Smith & Nephew PLC2 | 9,300,000 | 77,983 |
Elan Corp., PLC (ADR)1 | 3,000,000 | 26,580 |
Ranbaxy Laboratories Ltd.2 | 2,076,000 | 23,248 |
Coloplast A/S, Class B2 | 371,000 | 22,601 |
| | | 5,798,941 |
| | | |
ENERGY — 7.68% | | |
| Petróleo Brasileiro SA - Petrobras, ordinary nominative (ADR) | 10,301,150 | $ 736,429 |
| Petróleo Brasileiro SA - Petrobras, preferred nominative (ADR) | 798,850 | 50,927 |
Royal Dutch Shell PLC, Class B2 | 9,583,091 | 330,315 |
Royal Dutch Shell PLC, Class A2 | 6,600,000 | 217,600 |
| Royal Dutch Shell PLC, Class B (ADR) | 1,874,848 | 129,121 |
| Royal Dutch Shell PLC, Class A (ADR) | 1,000,000 | 65,640 |
MOL Magyar Olaj- és Gázipari Rt., Class A2 | 4,500,500 | 498,843 |
| Canadian Natural Resources, Ltd. | 8,580,000 | 387,984 |
Norsk Hydro ASA2 | 3,175,000 | 353,917 |
| Norsk Hydro ASA (ADR) | 250,000 | 27,812 |
Reliance Industries Ltd.2 | 20,260,718 | 366,325 |
| Petro-Canada | 8,600,000 | 360,444 |
TOTAL SA2 | 936,100 | 255,176 |
Repsol YPF, SA2 | 7,732,800 | 250,586 |
Oil & Natural Gas Corp. Ltd.2 | 10,204,400 | 246,553 |
| Nexen Inc. | 4,304,690 | 205,594 |
ENI SpA2 | 5,565,000 | 165,125 |
SK Corp.2 | 2,306,740 | 133,869 |
PetroChina Co. Ltd. Class H2 | 65,000,000 | 54,190 |
OAO NOVATEK (GDR)1,2,3 | 1,197,600 | 28,694 |
OAO NOVATEK (GDR)1,2 | 925,000 | 22,162 |
YUKOS Oil Co. (ADR)1,2 | 3,700,000 | 16,751 |
| | | 4,904,057 |
| | | |
CONSUMER STAPLES — 6.68% | | |
Nestlé SA2 | 2,332,500 | 683,596 |
Koninklijke Ahold NV1,2 | 77,643,332 | 587,610 |
| Cía. de Bebidas das Américas - AmBev, preferred nominative (ADR) | 7,300,000 | 271,414 |
| Cía. de Bebidas das Américas - AmBev, ordinary nominative (ADR) | 1,536,000 | 46,080 |
Unilever PLC2 | 27,915,989 | 291,978 |
| Wal-Mart de México, SA de CV, Series V | 57,417,859 | 291,955 |
Groupe Danone2 | 2,578,000 | 278,318 |
METRO AG2 | 3,965,000 | 195,437 |
Tesco PLC2 | 35,600,000 | 194,400 |
Unilever NV2 | 2,722,800 | 193,768 |
Seven & I Holdings Co., Ltd.1 | 4,663,400 | 154,379 |
Coca-Cola HBC SA2 | 4,184,583 | 121,427 |
Shinsegae Co., Ltd.2 | 310,000 | 115,243 |
Diageo PLC2 | 8,000,000 | 114,951 |
Woolworths Ltd.2 | 8,410,292 | 106,809 |
Uni-Charm Corp.2 | 2,213,900 | 95,598 |
L'Oréal SA2 | 1,230,000 | 95,356 |
Gallaher Group PLC2 | 5,550,866 | 86,093 |
Foster's Group Ltd.2 | 12,629,786 | 56,142 |
Heineken NV2 | 1,625,000 | 52,183 |
Orkla AS2 | 1,371,428 | 52,075 |
Pernod Ricard Co.2 | 275,000 | 48,570 |
Royal Numico NV1,2 | 840,000 | 36,806 |
| Coca-Cola FEMSA, SA de CV, Series L | 13,500,000 | 36,222 |
| Fomento Económico Mexicano, SA de CV (ADR) | 430,000 | 30,066 |
Coles Myer Ltd.2 | 3,470,000 | 27,147 |
| | | 4,263,623 |
| | | |
| | | |
MATERIALS — 5.62% | | |
| Cía. Vale do Rio Doce, preferred nominative, Class A | 6,860,000 | $ 268,194 |
| Cía. Vale do Rio Doce, ordinary nominative (ADR) | 5,896,700 | 258,629 |
Bayer AG2 | 12,510,000 | 458,461 |
| Cemex, SA de CV, ordinary participation certificates, units (ADR) | 8,504,791 | 444,801 |
Nitto Denko Corp.2 | 5,825,000 | 328,071 |
POSCO2 | 1,100,000 | 247,882 |
| Potash Corp. of Saskatchewan Inc. | 1,894,000 | 176,748 |
AngloGold Ashanti Ltd.2 | 3,860,000 | 166,206 |
Kuraray Co., Ltd.2 | 14,600,000 | 129,251 |
Siam Cement PCL2 | 19,086,100 | 118,281 |
BHP Billiton PLC2 | 6,000,000 | 97,048 |
JSR Corp.2 | 4,420,000 | 91,942 |
Gold Fields Ltd.2 | 6,107,500 | 91,104 |
Ivanhoe Mines Ltd.1 | 10,160,000 | 85,761 |
UPM-Kymmene Corp.2 | 4,000,000 | 80,090 |
Stora Enso Oyj, Class R2 | 5,394,843 | 74,190 |
Holcim Ltd.2 | 1,028,571 | 68,310 |
Harmony Gold Mining Co. Ltd.1,2 | 5,650,000 | 63,474 |
| Companhia Siderurgica Nacional SA, ordinary nominative | 2,325,000 | 54,170 |
Kaneka Corp.2 | 4,100,000 | 53,421 |
BASF AG2 | 600,000 | 45,142 |
L'Air Liquide2 | 224,000 | 41,275 |
Clariant Ltd.1,2 | 2,295,000 | 32,995 |
| Placer Dome Inc. | 1,862,200 | 31,903 |
Yara International ASA2 | 1,580,000 | 28,608 |
Sappi Ltd.2 | 2,383,000 | 28,092 |
Rio Tinto PLC2 | 375,000 | 15,324 |
| Abitibi-Consolidated Inc. | 1,800,000 | 7,240 |
Formosa Plastics Corp.2 | 210 | — |
| | | 3,586,613 |
| | | |
INDUSTRIALS — 4.23% | | |
Siemens AG2 | 6,604,000 | 509,679 |
Asahi Glass Co., Ltd.2 | 38,439,000 | 403,828 |
Mitsubishi Corp.2 | 17,700,000 | 349,419 |
FANUC LTD2 | 3,050,000 | 247,534 |
Marubeni Corp.2 | 44,500,000 | 207,135 |
Sandvik AB2 | 3,792,000 | 188,681 |
Mitsui & Co., Ltd.2 | 12,449,000 | 155,876 |
| Bharat Heavy Electricals Ltd. | 4,164,125 | 116,064 |
Capita Group PLC2 | 14,197,623 | 94,304 |
ALSTOM SA1,2 | 1,850,000 | 87,908 |
Metso Oyj2 | 2,500,000 | 63,495 |
Atlas Copco AB, Class A2 | 2,255,000 | 43,640 |
Vedior NV2 | 2,911,673 | 41,383 |
| Bombardier Inc., Class B | 16,698,200 | 41,278 |
JS Group Corp.2 | 2,390,000 | 40,698 |
Wesfarmers Ltd.2 | 1,180,000 | 36,116 |
Matsushita Electric Works, Ltd.2 | 2,515,000 | 25,023 |
Qantas Airways Ltd.2 | 9,309,391 | 23,944 |
Ryanair Holdings PLC (ADR)1 | 409,200 | 18,631 |
Ainax AB2 | 112,445 | 4,061 |
| | | 2,698,697 |
| | | |
| | | |
UTILITIES — 2.77% | | |
E.ON AG2 | 3,948,000 | $ 362,825 |
National Grid Transco PLC2 | 31,540,061 | 295,814 |
Scottish Power PLC2 | 24,286,000 | 244,897 |
Veolia Environnement2 | 5,335,400 | 225,333 |
Gas Natural SDG, SA2 | 6,510,000 | 189,605 |
Korea Electric Power Corp.2 | 4,515,960 | 154,228 |
Unified Energy System of Russia (GDR)2 | 3,580,000 | 139,391 |
Hong Kong and China Gas Co. Ltd.2 | 50,000,000 | 103,225 |
Tenaga Nasional Bhd.2 | 17,700,000 | 50,731 |
| | | 1,766,049 |
| | | |
MISCELLANEOUS — 2.41% | | |
| Other common stocks in initial period of acquisition | | 1,538,609 |
| | | |
| | | |
Total common stocks (cost: $43,693,450,000) | | 60,321,687 |
| | | |
| Warrants — 0.02% | | |
| | | |
FINANCIALS — 0.02% | | |
ING Groep NV, warrants, expire 20081 | 1,730,000 | 9,462 |
| | | |
Total warrants (cost: $46,430,000) | | 9,462 |
| | | |
| Convertible securities — 0.03% | Principal amount | |
| | | |
FINANCIALS — 0.03% | | |
Fairfax Financial Holdings Ltd. 5.00% convertible debentures 20233 | $20,000,000 | 19,975 |
| | | |
Total convertible securities (cost: $20,372,000) | | 19,975 |
| | | |
| | Principal amount | |
| Bonds & notes — 0.17% | (000) | |
| | | |
NON-U.S. GOVERNMENT BONDS & NOTES — 0.17% | | |
| Brazilian Treasury Bill 0% 2006 | R$162 | 66,761 |
| Brazilian Treasury Bill 0% 2007 | 119 | 43,678 |
| | | |
Total bonds & notes (cost: $99,972,000) | | 110,439 |
| | | |
| | | unaudited |
| | | |
| | Principal amount | Market value |
| Short-term securities — 5.19% | (000) | (000) |
| Danske Corp., Series A, 3.54%-3.73% due 10/11-11/21/2005 | $166,800 | $ 166,233 |
IXIS Commercial Paper Corp. 3.48%-3.80% due 10/14-12/5/20053 | 160,000 | 159,311 |
| Barclays U.S. Funding Corp. 3.63%-3.845% due 10/26-12/5/2005 | 121,000 | 120,443 |
Barclays U.S. Funding Corp. 3.785% due 12/14/20054 | 30,000 | 29,767 |
Depfa Bank PLC 3.64%-3.755% due 10/26-11/22/20053 | 100,000 | 99,579 |
| Depfa Bank PLC 3.57% due 10/18/2005 | 50,000 | 49,997 |
Anz National (International) Ltd. 3.535%-3.75% due 10/11-11/21/20053 | 150,000 | 149,553 |
National Australia Funding (Delaware) Inc. 3.60%-3.75% due 10/11-11/4/20053 | 150,000 | 149,512 |
| Dexia Delaware LLC 3.50%-3.795% due 10/14-12/1/2005 | 150,000 | 149,279 |
| Rabobank USA Financial Corp. 3.59%-3.84% due 10/24-12/6/2005 | 140,900 | 140,337 |
| Toyota Motor Credit Corp. 3.60%-3.83% due 10/20-12/6/2005 | 95,000 | 94,642 |
| Toyota Credit de Puerto Rico Corp. 3.58% due 10/17/2005 | 30,000 | 29,950 |
| CBA (Delaware) Finance Inc. 3.84% due 12/1-12/19/2005 | 110,000 | 109,184 |
| UBS Finance (Delaware) LLC 3.74%-3.86% due 10/3-11/3/2005 | 101,800 | 101,606 |
| Toronto-Dominion Bank 3.82%-3.85% due 11/29-12/2/2005 | 100,000 | 99,993 |
| Westpac Capital Corp. 3.50% due 10/13-10/17/2005 | 100,000 | 99,855 |
Mont Blanc Capital Corp. 3.72%-3.75% due 10/17-10/27/20053 | 100,000 | 99,755 |
Amsterdam Funding Corp. due 3.59%-3.77% due 10/19-11/10/20053 | 73,200 | 72,939 |
| ABN-AMRO North America Finance Inc. 3.45% due 10/11/2005 | 26,800 | 26,771 |
| BNP Paribas Finance Inc. 3.605%-3.775% due 10/18-11/30/2005 | 100,000 | 99,655 |
CAFCO, LLC 3.54%-3.80% due 10/5-11/17/20053 | 100,000 | 99,654 |
| HBOS Treasury Services PLC 3.51%-3.81% due 10/19-11/30/2005 | 100,000 | 99,599 |
| Royal Bank of Scotland PLC 3.64%-3.76% due 11/8-11/18/2005 | 100,000 | 99,529 |
Allied Irish Banks N.A. Inc. 3.67%-3.79% due 11/8-11/29/20053 | 100,000 | 99,484 |
Bank of Ireland 3.64%-3.80% due 11/10-12/1/20053 | 100,000 | 99,429 |
Total Capital SA 3.78%-3.84% due 11/22-12/2/20053 | 100,000 | 99,401 |
| Calyon North America Inc. 3.775% due 11/28/2005 | 100,000 | 99,382 |
| HSBC USA Inc. 3.62%-3.855% due 10/18-12/7/2005 | 75,000 | 74,734 |
Old Line Funding, LLC 3.76%-3.77% due 11/7-11/8/20053 | 75,000 | 74,699 |
| Bank of Montreal 3.54%-3.82% due 10/3-11/23/2005 | 50,000 | 49,998 |
| Société Générale North America Inc. 3.59% due 10/17/2005 | 50,000 | 49,916 |
| DaimlerChrysler Revolving Auto Conduit LLC II 3.65% due 10/19/2005 | 50,000 | 49,904 |
Wal-Mart Stores Inc. 3.57%-3.72% due 10/24-11/15/20053 | 50,000 | 49,834 |
| Caisse d'Amortissement de la Dette Sociale 3.80% due 12/5/2005 | 50,000 | 49,662 |
| Freddie Mac 3.42%-3.75% due 10/11-12/6/2005 | 49,300 | 49,106 |
KfW International Finance Inc. 3.73%-3.76% due 11/30-12/14/20053 | 47,000 | 46,674 |
BMW U.S. Capital Corp. 3.64% due 11/14/20053 | 26,200 | 26,079 |
IBM Capital Inc. 3.455% due 10/5/20053 | 25,000 | 24,988 |
| Federal Home Loan Bank 3.74% due 11/30/2005 | 25,000 | 24,850 |
| | | |
Total short-term securities (cost: $3,315,085,000) | | 3,315,283 |
| | | |
Total investment securities (cost: $47,175,309,000) | | 63,776,846 |
Other assets less liabilities | | 51,615 |
| | | |
Net assets | | $63,828,461 |
“Miscellaneous” securities include holdings in their initial period of acquisition that have not previously been publicly disclosed.
1Security did not produce income during the last 12 months.
2Valued under fair value procedures adopted by authority of the Board of Trustees. At September 30, 2005, 265 of the fund's securities, including
those in "Miscellaneous" (with aggregate value of $51,045,486,000), were fair valued under procedures that took into account significant
price changes that occurred between the close of trading in those securities and the close of regular trading on the New York Stock Exchange.
3Purchased in a private placement transaction; resale may be limited to qualified institutional buyers; resale to the public may require
registration. The total value of all such restricted securities was $1,400,193,000, which represented 2.19% of the net assets of the fund.
4This security, or a portion of this security, has been segregated to cover funding requirements on investment transactions settling in the future.
ADR = American Depositary Receipts
GDR = Global Depositary Receipts
ITEM 7 - Disclosure of Proxy Voting Policies and Procedures for Closed-End Management Investment Companies
Not applicable to this Registrant, insofar as the Registrant is not a closed-end management investment company.
ITEM 8 - Portfolio Managers of Closed-End Management Investment Companies
Not applicable to this Registrant, insofar as the Registrant is not a closed-end management investment company.
ITEM 9 - Purchases of Equity Securities by Closed-End Management Investment Company and Affiliated Purchasers
Not applicable to this Registrant, insofar as the Registrant is not a closed-end management investment company.
ITEM 10 - Submission of Matters to a Vote of Security Holders
There have been no material changes to the procedures by which shareholders may recommend nominees to the Registrant’s Board of Trustees since the Registrant last submitted a proxy statement to its shareholders. The procedures are as follows. The Registrant has a Nominating Committee comprised solely of persons who are not considered ‘‘interested persons’’ of the Registrant within the meaning of the Investment Company Act of 1940, as amended. The committee periodically reviews such issues as the Board’s composition, responsibilities, committees, compensation and other relevant issues, and recommends any appropriate changes to the full Board of Trustees. While the committee normally is able to identify from its own resources an ample number of qualified candidates, it will consider shareholder suggestions of persons to be considered as nominees to fill future vacancies on the Nominating Committee of the Registrant, c/o the Registrant’s Secretary, and must be accompanied by complete biographical and occupational data on the prospective nominee, along with a written consent of the prospective nominee for consideration of his or her name by the Nominating Committee.
ITEM 11 - Controls and Procedures
| (a) | The Registrant’s Principal Executive Officer and Principal Financial Officer have concluded, based on their evaluation of the Registrant’s disclosure controls and procedures (as such term is defined in Rule 30a-3 under the Investment Company Act of 1940), that such controls and procedures are adequate and reasonably designed to achieve the purposes described in paragraph (c) of such rule. |
| (b) | There were no changes in the Registrant’s internal controls over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940) that occurred during the Registrant’s second fiscal quarter of the period covered by this report that has materially affected, or is reasonably likely to materially affect, the Registrant’s internal control over financial reporting. |
ITEM 12 - Exhibits
| (a) (1) | The Code of Ethics - not applicable for filing of Semiannual Reports to Shareholders. |
| (a) (2) | The certifications required by Rule 30a-2 of the Investment Company Act of 1940, as amended, and Sections 302 and 906 of the Sarbanes-Oxley Act of 2002 are attached as exhibits hereto. |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
EUROPACIFIC GROWTH FUND
By /s/ Mark E. Denning
Mark E. Denning, President and PEO
Date: December 8, 2005
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the Registrant and in the capacities and on the dates indicated.
By /s/ Mark E. Denning
Mark E. Denning, President and PEO
Date: December 8, 2005
By /s/ R. Marcia Gould
R. Marcia Gould, Treasurer and PFO
Date: December 8, 2005
